Nifty manages to end in green

13 Oct 2020 Evaluate

NSE benchmark index -- Nifty -- managed to close in green after volatile day of trade on Tuesday. Index started the day on cautious note, as government data showed that Industrial production declined by 8% in August, mainly due to lower output of manufacturing, mining and power generation sectors. Also, retail inflation rose to 7.34% in September, mainly on account of higher food prices. Soon market entered into green territory after Niti Aayog Vice-Chairman Rajiv Kumar said that the fresh stimulus package announced by Finance Minister Nirmala Sitharaman to boost domestic demand will give a much-needed push to economic activity. Adding optimism, RBI raised banks' maximum aggregate retail exposure limit to entities with turnover up to Rs 50 crore to Rs 7.5 crore, up from Rs 5 crore, in a bid to increase credit flow to small businesses.

However, in late afternoon session, market turned volatile, as the stalemate over compensating states for the shortfall in Goods and Services Tax (GST) collections continued with a meeting of the GST Council ending without reaching any consensus. The panel, which is the highest decision-making body on indirect taxes, for the second time in a week failed to reach a consensus on the Centre's proposal of states borrowing against future GST collections to make up for the shortfall.

Most of the sectoral indices ended in red except IT and Metal. The top gainers from the F&O segment were Coforge, HCL Technologies and Info Edge (INDIA). On the other hand, the top losers were LIC Housing Finance, ZEE Entertainment Enterprises and Cipla. In the index option segment, maximum OI continues to be seen in the 12,000 - 12,700 calls and 10,000 - 10,900 puts indicating this is the trading range expectation.


India Volatility Index (VIX), a gauge for market’s short term expectation of volatility decreased by 1.95% and reached 20.72.The 50 share Nifty up by 3.55 points or 0.03% to settle at 11,934.50.

Nifty October 2020 futures closed at 11937.35 (LTP) on Tuesday, at a premium of 2.85 points over spot closing of 11934.50, while Nifty November 2020 futures ended at 11962.65 (LTP), at a premium of 28.15 points over spot closing.  Nifty October futures saw an addition of 4,203 units, taking the total open interest (Contracts) to 1,55,454. The near month derivatives contract will expire on October 29, 2020 (Provisional).

From the most active contracts, Reliance Industries October 2020 futures traded at a premium of 3.00 points at 2282.00 (LTP) compared with spot closing of 2279.00. The numbers of contracts traded were 35,736 (Provisional).

Infosys October 2020 futures traded at a discount of 8.30 points at 1151.70 (LTP) compared with spot closing of 1160.00. The numbers of contracts traded were 23,503 (Provisional).

Bharti Airtel October 2020 futures traded at a premium of 1.85 points at 417.85 (LTP) compared with spot closing of 416.00. The numbers of contracts traded were 20,917 (Provisional).

Bajaj Finance October 2020 futures traded at a premium of 0.65 points at 3274.65 (LTP) compared with spot closing of 3274.00. The numbers of contracts traded were 19,964 (Provisional).

SBIN October 2020 futures traded at a premium of 0.50 points at 196.00 (LTP) compared with spot closing of 195.50. The numbers of contracts traded were 19,205 (Provisional).

Among, Nifty calls, 12000 SP from the October month expiry was the most active call with an addition of 116 units open interests. Among Nifty puts, 11900 SP from the October month expiry was the most active put with an addition of 3,654 units open interests. The maximum OI outstanding for Calls was at 12500 SP (31,332 units) and that for Puts was at 10500 SP (46,069 units). The respective Support and Resistance levels of Nifty are: Resistance 11,985.50 -- Pivot Point 11,937.20 -- Support -- 11,886.20.

The Nifty Put Call Ratio (PCR) finally stood at (1.51) for October month contract. The top five scrips with highest PCR on Indusind Bank (0.89), HDFC (0.85), Apollo Tyre (0.85), TCS (0.84) and Apollo Hospital (0.79).

Among most active underlying, Reliance Industries witnessed an addition of 682 units of Open Interest in the October month futures contract followed by Infosys witnessed an addition of 2,831 units of Open Interest in the October month futures contract, DR. Reddy's Laboratories witnessed an addition of 429 units of Open Interest in the October month futures contract, HCL Technologies witnessed a contraction of 57 units of Open Interest in the October month futures contract and Wipro witnessed an addition of 760 units of Open Interest in the October month future contract (Provisional).

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