Markets Cautious ahead of earning season; to remain choppy with negative bias - Consortium

Markets ended marginally lower in today's trade with benchmark indices like the Sensex and Nifty closing with a negative bias of 0.47% and 0.46% respectively.

Profit booking was witnessed in select sectors. Broader Markets ended positive with the BSE Midcap and BSE Small cap ending with marginal gains of 0.24% and 0.55% respectively. Majority of the BSE sectoral indices closed lower, with the BSE FMCG (-1.05%), BSE Capital Goods (-1.47%) and BSE Consumer Durables (-1.00%) indices among the major losers. On the other hand the BSE Metal Index (0.94%) registered significant gains.Prominent stocks that stood out today included BPCL, Maruti Suzuki, Cipla, Tata Steel and Cairn India which logged in gains, while L&T, JP Associates, HDFC, HUL and GAIL ended with losses.Most Asian Indices closed in the red earlier today, with the Nikkei registered a loss of 0.83% while the Hang Seng and Strait Times ended with a negative bias of 0.01% and 0.22% respectively.

For the day coming by global cues are not so constructive as US stocks finished in negative territory ahead of the fourth-quarter earnings season. Asian shares are also trading on a cautious note. World stocks are alos unser some pressure as Fed signaled that the US central bank could bring quantitative easing to an end this year.

Yesterday Nifty felled by 28 odd points snapping four-day winning streak. Caution crept in ahead of the earnings season and traders choose to book profits after recent rally. Dissecting the options data , Nifty Jan futures settled at a premium of 35 as against a premium of 32 in the previous session. In Jan series for Nifty, Highest Call OI is at 6200 strike and highest Put OI is at 5800 strike Maruti (Cmp 1585, up 3%) witnessed delivery of 0.5m shs (10d-avg 0.2m shs) along with 7% rise in Fut OI to 2.1m shs indicating built up of long positions. LT (Cmp 1588, down 2%) witnessed delivery of 1.3m shs (10d-avg 0.6m shs) along with 24% rise in Fut OI to 5.2m shs indicating creation of short positions. FIIs appetite however remained largely positive.

Yesterday, Nifty formed a Bearish candle, faced resistance at higher levels and has slipped below 6000 mark. Failure to sustain at these levels will drift Nifty lower to fill the gap levels between 5965- 5980 levels and then another gap between 5920-5935 levels.

Source : Equity Bulls

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