Nifty ends higher for second straight day

The fifty stock index -- Nifty -- ended higher on Thursday, on account of sustained buying by fund and retail investors.  Sentiments remained upbeat with Cabinet’s approval for the WTO's Trade Facilitation Agreement (TFA) which aims at easing customs procedures to boost commerce. TFA will contain provisions for movement of goods, release and clearance of goods and goods in transit.  Further, some support also came in with the Moody's Investors Service’s report that in the macro-economic front, Indian economy will grow at 7.5% in 2016 and 2017 as it is relatively less exposed to external headwinds, like China slowdown and will benefit from lower commodity prices.  After a gap- up opening, market extended its initial gain, but market participants took some profit off the table at higher level in afternoon deals. Thereafter, Market once again gained momentum in last leg of trade and finally ended near intraday high level.

On the global front, Asian markets ended mostly higher, as crude oil prices escalated as hopes that the big oil producers will cap the output in order to tackle the supply glut. European markets were trading mostly in green, with Germany’s DAX was up by 1.03% and France’s CAC was up by 0.58%, while UK’s FTSE 100 was down by 0.36%.

The top gainers from the F&O segment were Jain Irrigation Systems, Crompton Greaves and Strides Shasun. On the other hand, the top losers were PTC India, Rural Electrification Corporation and Jubilant Foodworks. In the index options segment, maximum OI was being seen in the 7000-7800 calls and 6500-7400 puts. In today's session, while the traders preferred to exit 6900 put, heavy buildup was seen in the 7200 put. On the other hand, traders exited from 7200 Call, while 7300 call witnessed considerable OI addition.  

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility decreased by 1.59% and reached 21.48. The 50-share Nifty was up by 83.30 points or 1.17% to settle at 7,191.75.   

Nifty February 2016 futures closed 7190.85 on Thursday at a discount of 0.90 points over spot closing of 7,191.75, while Nifty March 2016 futures ended at 7210.80 at a premium of 19.05 points over spot closing. Nifty February futures saw addition of 0.52 million (mn) units, taking the total outstanding open interest (OI) to 21.62 million (mn) units. The near month derivatives contract will expire on February 25, 2016.                    

From the most active contracts, ICICI Bank February 2016 futures traded at a premium of 0.30 points at 195.95 compared with spot closing of 195.65. The number of contracts traded were 26,141.            

SBI February 2016 futures traded at a premium of 0.35 points at 159.35 compared with spot closing of 159.00. The number of contracts traded were 27,782.                      

Bank of Baroda February 2016 futures traded at a premium of 0.95 points at 138.95 compared with spot closing of 138.00. The number of contracts traded were 17,604.               

Axis Bank February 2016 futures traded at a premium of 1.45 points at 398.65 compared with spot closing of 397.20. The number of contracts traded were 19,230.                                              

Tata steel February 2016 futures traded at a premium of 0.65 points at 251.15 compared with spot closing of 250.50. The number of contracts traded were 17,247.  

Among Nifty calls, 7200 SP from the January month expiry was the most active call with a contraction of 0.89 million open interests. Among Nifty puts, 7100 SP from the January month expiry was the most active put with an addition of 0.48 million open interests. The maximum OI outstanding for Calls was at 7400 SP (5.99 mn) and that for Puts was at 7000 SP (5.72 mn). The respective Support and Resistance levels of Nifty are: Resistance 7228.62 --- Pivot Point 7178.23 --- Support --- 7141.37.            

The Nifty Put Call Ratio (PCR) finally stood at 0.85 for January month contract. The top five scrips with highest PCR on OI were Godrej Consumer Products (2.00), Hero MotoCorp (1.76), Eicher Motors (1.61), Oil India (1.50) and Indian Overseas Bank (1.36). 

Among most active underlying, State Bank of India witnessed a contraction of 1.41 million of Open Interest in the January month futures contract, followed by Larsen & Toubro witnessing a contraction of 0.31 million of Open Interest in the January month contract; Tata Steel witnessed a contraction of 1.36 million of Open Interest in the January month contract, ICICI Bank witnessed an addition of 0.60 million of Open Interest in the January month contract and Dr. Reddy's Laboratories witnessed a contraction of 0.12 million units of Open Interest in the January month's future contract.