Contracts in discount zone

DERIVATIVES REPORT

The National Stock Exchange (NSE) Nifty closed lower on all-round selling pressure, falling 1.71 per cent to close at 2,026.40. In the derivatives segment, the Nifty was last traded at 2,021.90. More than 4,65,715 contracts (3,10,691 contracts) worth Rs 17,741.31 crore (Rs 11,987.01 crore) were traded in the derivatives segment, a dealer from a local brokerage said.

While stock specific action was being seen in the cash market, the sentiment was subdued in the F&O segment. The Nifty closed at a discount of Rs 4.50 in the futures market compared to the cash segment.

Vijay Bhambwani, chief executive officer at BSPLIndia said, "The markets opened on a shaky note and proceeded to trade with extreme weakness through the day. The F&O data for the previous session shows a decrease in open interest, which shows an unloading bias even at lower levels. The traded volumes, market breadth and open interest point towards a selling bias which will result in higher volatility in the coming days. The most vulnerable scrips will be the ones where concentrated open interest positions remain."

The indices have broken the supports at the 6524 and 2035 levels and closed well below these short term threshold levels. The intra-day supports for the coming session will be at the 2004 and the 6414 levels on the Nifty and Sensex, respectively.

The upsides are likely to be capped at the 2044 and the 6482 in the immediate future, analysts added.