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| F&O Outlook: Nifty likely to face strong resistance above 4,650 |
| BG Shirsat / Mumbai Jun 12, 2009, 08:42 IST |
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Key benchmark indices lost some ground gained in the last two days as investors booked profit in oil, technology and bank stocks. Metals, automobile and fast moving consumer goods (FMCG) stocks moved up on buying.
The Nifty touched an intra-day high of 4,680 but failed to close above 4,650, the level that held the key for the index to continue the uptrend.
The trading volume in the futures & options (F&O) segment declined by Rs 10,000 crore, which indicated that traders were wary of taking intra-day positions.
The Nifty June futures moved in a narrow range of 30 points. A total of 4,87,684 contracts of 50 shares each changed hands at around 4,641, compared with the closing level of 4,649. No wonder, the trading volume was lower by 90,000 contracts over Wednesday.
The June futures closed at a premium to the spot and shed an open interest (OI) of 7,44,450 shares, indicating profit-booking by bulls. The Instanex FII index of 15 stocks under-performed the benchmark indices, hinting at the fact that foreign investors have booked profit today. Profit-booking by FIIs was seen in Infosys Technologies, Bhel, ONGC and State Bank of India (SBI), while they were net buyers in Bharti Airtel, HDFC Bank, ITC and NTPC.
Unwinding in 4,700 and 4,800 calls was witnessed again. Profit-booking was seen in 4,500 and 4,600 calls at higher levels.
This meant that a section of options traders wrote out of money calls on expectations that the index had strong resistance above 4,650.
The put OI in 4,300-4,500 puts accounted for over 50 per cent of the total OI, suggesting that the Nifty continued to get support at 4,500, 4,400 and 4,300 levels.
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