Nifty wipes out early losses; ends above 11950 mark

The local benchmark -- Nifty -- wiped out early losses to end Wednesday’s session above 11950 mark. Market made a negative start after the International Monetary Fund said India is headed for the biggest slump of any major emerging nation. IMF has projected the Indian economy to contract by 10.3% this year, owing to the coronavirus pandemic. However, the IMF also said that India is likely to bounce back with an impressive 8.8% growth in 2021. The 8.8% growth rate would make India as the fastest growing emerging economy in the world. Market extended its losses, as total of 10 companies rated by S&P Global Ratings including seven confidential issuers defaulted in Asia last year, up from three corporate defaults in 2018. Meanwhile, the total number of rated issuers in Asia increased to 911 in 2019 from 831 in 2018. However, in the last leg of trade market erased all its losses to spike up in green territory, as traders found support after International Monetary Fund stated that Indian economy would be well placed to start recovering from the horrible crisis with the government making efforts on both the fiscal and monetary side in addition to putting in place structural elements.

Most of the sectoral indices ended in green except IT, Auto and Pharma. The top gainers from the F&O segment were Indiabulls Housing Finance, Tata Consumer Products and Info Edge (INDIA). On the other hand, the top losers were Wipro, Coforge and NTPC. 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 2.43% and reached 20.21.The 50 share Nifty up by 36.55 points or 0.31% to settle at 11,934.50.

Nifty October 2020 futures closed at 11973.00 (LTP) on Wednesday, at a premium of 1.95 points over spot closing of 11971.05, while Nifty November 2020 futures ended at 11996.60 (LTP), at a premium of 25.55 points over spot closing.  Nifty October futures saw an addition of 2,987 units, taking the total open interest (Contracts) to 1,56,469. 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 2.45 points at 2285.45 (LTP) compared with spot closing of 2283.00. The numbers of contracts traded were 34,084 (Provisional).

Wipro October 2020 futures traded at a premium of 0.95 points at 350.35 (LTP) compared with spot closing of 349.40. The numbers of contracts traded were 26,846 (Provisional).

Bajaj Finance October 2020 futures traded at a premium of 12.50 points at 3377.00 (LTP) compared with spot closing of 3364.50. The numbers of contracts traded were 26,004 (Provisional).

HDFC Bank October 2020 futures traded at a premium of 2.45 points at 1215.95 (LTP) compared with spot closing of 1213.50. The numbers of contracts traded were 25,008 (Provisional).

ICICI Bank October 2020 futures traded at a premium of 0.75 points at 406.50 (LTP) compared with spot closing of 405.75. The numbers of contracts traded were 24,889 (Provisional).

Among, Nifty calls, 12000 SP from the October month expiry was the most active call with a contraction of 387 units open interests. Among Nifty puts, 11700 SP from the October month expiry was the most active put with an addition of 7,314 units open interests. The maximum OI outstanding for Calls was at 12500 SP (31,144 units) and that for Puts was at 10500 SP (45,116 units). The respective Support and Resistance levels of Nifty are: Resistance 12,038.12 -- Pivot Point 11,930.13 -- Support --11,863.07.

The Nifty Put Call Ratio (PCR) finally stood at (1.54) for October month contract. The top five scrips with highest PCR on Indusind Bank (0.93), HDFC (0.85), TCS (0.82), Axis Bank (0.81) and ICICI Bank (0.76).

Among most active underlying, Reliance Industries witnessed an addition of 2,532 units of Open Interest in the October month futures contract followed by Infosys witnessed an addition of 2,829 units of Open Interest in the October month futures contract, Wipro witnessed an addition of 20 units of Open Interest in the October month future contract, Bajaj Finance witnessed an addition of 202 units of Open Interest in the October month futures contract and HCL Technologies witnessed a contraction of 172 units of Open Interest in the October month futures contract(Provisional).