Nifty snaps January F&O series up by over 9%

The domestic index S&P CNX Nifty finally finished the January series on a jubilant note conquering its crucial 9,950 level on bout of positive triggers both at home and global front, moreover the index performed well during the series and closed higher by over 770 points or 9 percent compared to last series. Traders were seen rolling-over their positions to fresh month F&O contracts on a cautious note that the Reserve Bank of India (RBI) will surprise markets by cutting interest rates at its upcoming monetary policy review in February 2015.

Meanwhile, today’s session started off on a dull note but the markets put on a spirited performance in the last half hour to end the day on a high, above that crucial 9,950 mark. Sentiments got support with Global credit rating agency Moody’s Investor Service saying that India’s international credit ratings might be boosted if the government frames policies for the food sector based on the recommendations of a high-powered panel on reforming the Food Corporation of India (FCI) as it will reduce inflationary pressures and government’s fiscal deficit. Some support also came with report that foreign institutional investors were net buyers in Indian equities worth Rs 1,723 crore on January 28, 2014. However, gains remained capped as Asian shares fell after the Federal Reserve took an upbeat view of the U.S. economy and signalled it remained firmly on track to raise interest rates this year.

Nifty gained 0.43 percent, rising for a tenth consecutive session, its longest winning streak since September 2007, ahead of the fiscal budget next month. Most of the sectoral indices on the NSE settled in the positive territory with CNX Realty gaining the most, ending with a gain of over two and half percent followed by CNX Pharma up by 1.51% and CNX Energy up by 1.18% while, CNX PSU Bank down 2.72%, CNX Finance down 0.25% and CNX Metal up by 0.22% remained the major losers on NSE sectoral space.

Many traders rolled over positions in the futures & options (F&O) segment from the January 2015 series to February 2014 series. Sectorally, pharma, FMCG and telecom stocks are witnessing high rollover of positions while stocks from the capital goods, cement and automobile space are witnessing relatively low rolls into the February series. The top gainers from the F&O segment were HDIL, Arvind and Unitech. On the other hand, the top losers were Oriental Bank of Commerce, Union Bank of India and Idea Cellular.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility decreased by 1.71% and reached 19.43. The 50-share CNX Nifty was up by 38.05 points or 0.43% to settle at 8,952.35.

Nifty February 2015 futures closed at 8986.30 on Thursday at a premium of 33.95 points over spot closing of 8952.35, while Nifty March 2015 futures ended at 9036.05 at a premium of 83.70 points over spot closing. Nifty February futures saw an addition of 4.32 million (mn) units, taking the total outstanding open interest (OI) to 24.74 million (mn) units. The near month derivatives contract will expire on February 26, 2015.

From the most active contracts, HDFC Bank February 2015 futures traded at a premium of 13.35 points at 1106.35 compared with spot closing of 1093.00. The number of contracts traded were 49,831.

Reliance Industries February 2015 futures traded at a premium of 6.35 points at 934.30 compared with spot closing of 927.95. The number of contracts traded were 48,228.

ONGC February 2015 futures traded at a premium of 2.75 points at 353.25 compared with spot closing of 350.50. The number of contracts traded were 25,757.

Axis Bank February 2015 futures traded at a premium of 3.30 points at 603.05 compared with spot closing of 599.75. The number of contracts traded were 33,033.

Tata Steel February 2015 futures traded at a premium of 1.55 points at 391.55 compared with spot closing of 390.00. The number of contracts traded were 26,199.Among Nifty calls, 9000 SP from the February month expiry was the most active call with an addition of 0.43 million open interests. Among Nifty puts, 8,800 SP from the February month expiry was the most active put with an addition of 0.62 million open interests. The maximum OI outstanding for Calls was at 9000 SP (3.47 mn) and that for Puts was at 8,500 SP (2.23 mn).  The respective Support and Resistance levels of Nifty are: Resistance 8992.25 --- Pivot Point 8926.75 --- Support --- 8886.85.

The Nifty Put Call Ratio (PCR) finally stood at 3.03 for February month contract. The top five scrips with highest PCR on OI were IOB (6.27), UltraTech Cement (2.31), AXIS Bank (2.20), Oriental Bank of Commerce (2.14) and YES Bank (1.87). 

Among most active underlying, Reliance Industries witnessed an addition of 3.55 million of Open Interest in the February month futures contract, followed by HDFC Bank witnessing an addition of 3.01 million of Open Interest in the February month contract; State Bank of India witnessed an addition of 9.05 million of Open Interest in the February month contract, Ashok Leyland witnessed an addition of 24.51 million of Open Interest in the February month contract and Axis Bank witnessed an addtion of 26.24 million of Open Interest in the February month's future contract.