A1FS Views

Market in a nutshell

• Tracking global cues, local bourses opened weak and remained at the low levels throughout the session. Selling pressure was witnessed across all sectors, however few IT stocks gained. Sensex finally closed at 16,349 (down 300 points) while Nifty ended the day at 4,875 (down 71 points).
• Nifty witnessed strong rollover with 39% of the positions getting rolled on D-3 of expiry day. As the market shows a negative bias, short Nifty (hedge) positions are getting rolled aggressive with the roll cost of 3-5 points (cost to the short roller). We expect the roll cost to widen further on the back of aggressive short positions in Nifty getting rolled towards the expiry day.
• On the Single stock futures (SSF) the rollover is being lack luster with 29% of the positions getting rolled but at a low roll cost of 55-60 bps (cost to the long roller). The low roll cost indicates lack of aggression from the short rollers. We expect this roll cost in SSF to hover round the same levels of 55-65 levels.
• BSE Bankex plunged 3.5% to 7,939, with ICICI Bank falling over 4% to INR 827. BSE Capital Goods lost 3% to 12,834, with BHEL down 5% to INR 1,656.
• Nifty May Futures were trading at a discount of 7-10 points to spot for major part of the session.
• Market breadth was extremely poor with an Advance: Decline Ratio of 1:6. Bajaj Hindustan tumbled 9% to INR 199, while IVRCL Infrastructure fell 7% to INR 382.
• Cash volumes were low at INR 158,598mn (NSE+BSE) as against a 5 DMA of INR 198,647mn. F&O volumes were at INR 441,035mn as against a 5 DMA of INR 394,086mn.

Eye Catchers

• Glaxo Smithkline was up 5% to INR 1,130 with volumes of 176,186 (up 340%).
• Patel Engineering declined 7% to INR 498 with volumes of 223,653 (up 480%),

Market News

• Rupee was steady at INR 42.73 against the dollar.
• Nymex crude rose to trade at $133.3/ bbl. Base metals were trading on a mixed note, with zinc up 2%.

Indices Performance

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