Indecisiveness haunts Street

F&O OUTLOOK

The market showed signs of a good recovery at opening bell, but could not hold on to its gains due to profit booking at higher levels.

The market breadth was negative, with 758 advancing stocks as against 1,923 declines. The derivatives volumes remained unchanged at Rs 47,000 crore, given the low trading interest in index and stock futures.

The Nifty futures traded at a marginal discount, while the open interest in Nifty March futures contracts declined steeply by 8.37 per cent or 28.47 lakh shares.

With only four days left for the expiry of March futures contracts, the rollovers to April futures contracts were modest at 20 per cent.

The day's developments suggest indecisiveness among the market participants. The bulls were not willing to take positions at current levels, while the bears were unwilling to hold on their shorts.

The Nifty futures open interest has declined from this month's high of around 44 million shares to 39 million shares, demonstrating profit booking by bears. The Nifty has shed almost 700 points from its March 2 high of 5,222.

The Nifty PCR edged up marginally to 0.85 from 0.83 as the buying in Put options was marginally higher than Calls. The

Puts added 8.89 lakh shares and Calls added 4.32 lakh shares in open interest.

The Nifty 4700 calls and 4250 puts have seen fresh OI build-up, signalling the trading range for Nifty in the near term.

The 4450 mark remains an immediate support level. The Nifty seems to be headed downwards, nevertheless, and is expected to test 4260 in the next few weeks.