Indian markets wrapped the week on an optimistic note on the back of positive cues from Asia as commodity prices advanced and tensions on the Korean peninsula eased. Further sustained buying aided Sensex and Nifty to regain 20,000 and 6,000 mark respectively. Major gainers over the week in the sectoral indices were Metal, which surged 3.94%, IT rose 1.78%, Teck rose 1.63%, Auto gained 1.28%, and FMCG went up 1.17%. However, Capital goods dropped marginally 0.90%, PSU dipped 0.61%, Oil & Gas fell 0.43% were among the losers in the sectoral indices pack.
The 30 share index, Sensex rose 208.81 points, or 1.05%, to 20,073.66 in the week ended Dec. 24, 2010. On the other hand, the broad based NSE Nifty climbed 62.85 points, or 1.06%, to 6,011.60 in the same period.
Mid-cap stocks rose 59.19 points, or 0.78%, to 7,627.2 in the week. While small-cap shares rose 170.43 points, or 1.86%, to 9,354.43 during the week.
Meanwhile, Food inflation surged back into double-digit territory at 12.13% for the week ended December 24 as the prices of vegetables, particularly onions, rose for the third consecutive week.
On corporate front, JSW Steel (JSW) acquired 41% stake in Ispat Industries (Ispat) for Rs 21.57 billion by subscribing to 1,087 million fresh equity shares. The enterprise value and equity valuation post transaction are Rs 11.5 billion and Rs 52.6 billion, respectively.
KOTAK SECURITIES: “In the last week market remained in the tight trading range of 5,900-6,030. This week trading range has been narrowest for the last 10 weeks”.
“Formation of the current week is the continuation of the last week Bullish harami candle pattern. Market has closed well above the last week close and also at the week`s highest level. This signifies bullishness in the short term. Bullishness can continue for immediate hurdle at 6,060. Conquering the level of 6,090 will bring in further momentum and bullishness to the index. If market manages to close above the level of 6,090 then markets can move upwards for the level of 6,150 on higher side. Market has good depth at the 5,900 level”.
SMC GLOBAL: While commenting on the derivative trend of the market, the brokerage house SMC Global said, “Last week Nifty traded in the narrow range leading to fall in market volatility indicators. Nifty VIX has dropped and is expected to remain range bound in the short term. Implied Volatility (IV) of ATM put options ended at 17.59%. IV of call options closed at 17.61% on Thursday”.
“Put-call ratio of open interest moved higher during the week and finally closed at 1.38 levels indicating selling in lower strike puts. The concentration has shifted from the 6,000-strike call option to the 5,800 strike put option. However 6,000 strike call option carries the highest open interest of above 8.6 million shares, making it a strong resistance to be observed in the near term”.
“The 5,800 and 5,900 put-option strikes have more than 7.5 million shares in open interest. Nifty is expected to remain in a broad range of 5,900- 6,100 in current expiry with an intermediary support at around 5,940 levels. The move may remain sideways with resistance near 6,000-6,070 levels followed by 6,100 levels”.
FOR TODAY: In the meantime, nifty future opens at 6039.95, made a high of 6056.90 and low of 6037.95. Presently trading at 6053.25 (0.25% up).
I MAY GO SHORT AROUND 6080 LEVEL WITH STRICT STOPLOSS OF 6087-6090. DUE TO FNO EXPIRY WEEK, VOLATILITY WILL BE SEEN. TAKE ADVANTAGE OF THE VOLATILITY.
