Asian stocks declined, dragging the MSCI Asia Pacific Index down by the most in three weeks

International News:

Asian stocks declined, dragging the MSCI Asia Pacific Index down by the most in three weeks, as raw- material prices fell and Hong Kong enacted measures to curtail property speculation. U.S. stocks will “drop painfully from current levels,” in the coming year amid disappointing economic data and profits as margins shrink, according to investor Jeremy Grantham. Prime Minister’s Economic Advisory Council headed by Rangarajan said that the economy could grow between 6.25 per cent and 6.75 per cent, as against the 7-7.5 per cent projected in January. Power capacity addition has fallen short of its target by nearly a third in the first half (April- September) Mahindra group, the new owner of Satyam Computers and Tech Mahindra, is set to merge the two companies after June next year to transform the combined entity into an Indian information and communication technology powerhouse. Motherson Sumi bags Rs.1400 cr deal from two European auto firms for supply of rearview mirrors.

Technical View:

Nifty: (4965): The index opened on a flat note but was unable to hold onto the gains.
It ended the day with loss of 31 points. The index is encountering stiff resistance around the 20 dma level around 5038; intra day pullback is facing stiff resistance around the 20 dma levels. Higher resistance is around the 10 dma level around 5070.On the downside index has support around 4933 and 4900,lower support is around 4857,intra day declines should find support around the 4900 level. Nifty Oct contract ends the Day down by 26.95 points at a premium of 7.35 points in Oct contracts adding OI by 2.6% across all active Nifty contracts. Nifty Open Int PCR at 1.314 compared to 1.289 last Day on back of addition of 12.98 Lakh in Nifty puts and addition of 0.56 Lakh call options. Nifty VIX at 25.28 from 26.28 the previous Day.
Highest OI in Nifty put at 4900 Oct strike and calls is at 5100 Oct strike. Market wide rolls seen at 31.71% compared to 3 month average of 26.89% and 6 month average of 25.26%. Nifty rollover seen at 31.34% compared to the 6 month average of 32.22%.

Views and Outlook:

Nifty rollover is in line with the averages and long rolls is seen in Nifty. Further declines may be seen in line with the overseas cues at the open with supports seen at 4920 in Nifty near contracts.