Fresh short positions seen

F&O OUTLOOK

The Sensex ended at 15,422 (down 275 points) and the Nifty at 4,582 (down 71 points). Selling was witnessed across the board, particularly impacting the realty, banking, technology and capital goods sectors.

The Nifty June futures traded at a discount of 20 points for most part of the session, suggesting the creation of short positions.

However, with the Sensex and Nifty declining sharply by over 2.3 per cent each in afternoon trading, the bear operators covered up their short positions. The Nifty futures discount reduced to 10 points in the last half an hour and the open interest declined by 1.66 per cent.

The BSE Realty Index and Bankex were the major losers, falling around 3.5 per cent each to 5,886 and 7,306 respectively. The June futures of DLF and Unitech declined by over 3.5 per cent each on fresh short build-up in DLF and profit-booking in Unitech.

The June futures of ICICI Bank declined 4.10 per cent, while the open interest rose by 700,000 shares. State Bank of India declined 3.1 per cent and the open interest went up by 200,000 shares. Reliance added an open interest of 200,000 shares, while the futures price declined two per cent. This suggests fresh short build-up in ICICI Bank, SBI and Reliance in Wednesday's trade.

The Nifty is expected to correct till 4500 and this should be used as a buying opportunity, with a stop loss of 4480.