Nifty extends northward journey for fourth straight session on Friday

Nifty has extended its northward journey for fourth straight session on Friday and ended with marginal gain, as traders got some encouragement with the statement of Jayant Sinha that the government has a ‘very good sense’ of the problem of bad loans in banking sector and will continue to provide funds to strengthen state-owned banks. He said government has provided Rs 25,000 crore in the Budget 2016 and will provide more as necessary to ensure that banks are well capitalized. But, upside remained capped as market participants remained on sidelines ahead of outcome of the second edition of Gyan Sangam, a retreat of heads of public sector financial institutions, in the background of the government's strategy to consolidate public sector (PSU) banks.

On the global front, Asian shares ended mostly higher after a string of positive U.S. economic data and a bounce in oil and commodity prices. European shares were trading firm tracking Asian cues with UK’s FTSE 100 was up by 0.40%, Germany’s DAX was up 0.37% and France’s CAC was up 0.34%.

Back home, with a positive start nifty recaptured 7,500 mark, thereafter benchmark was alternating between positive and negative territory throughout the session and finally ended with marginal gain of over 10 points. The top gainers from the F&O segment were Just Dial, Kaveri Seed Company and Syndicate Bank. On the other hand, the top losers were Motherson Sumi Systems, KPIT Technologies and Tech Mahindra. In the index options segment, maximum OI was being seen in the 7000-8000 calls and 6500-7400 puts. In today's session, while the traders preferred to exit 6900 put, heavy buildup was seen in the 7400 put. On the other hand, traders exited from 7200 Call, while 7500 call witnessed considerable OI addition.  

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility decreased by 0.97% and reached 17.88. The 50-share Nifty was up by 9.75 points or 0.13% to settle at 7,485.35.   

Nifty March 2016 futures closed 7460.35 on Friday at a discount of 25.00 points over spot closing of 7,485.35, while Nifty April 2016 futures ended at 7487.75 at a premium of 2.40 points over spot closing. Nifty March futures saw addition of 0.89 million (mn) units, taking the total outstanding open interest (OI) to 22.22 million (mn) units. The near month derivatives contract will expire on March 31, 2016.                      

From the most active contracts, SBI March 2016 futures traded at a discount of 0.95 points at 188.15 compared with spot closing of 189.10. The number of contracts traded were 41,448.                      

ICICI Bank March 2016 futures traded at a discount of 2.05 points at 219.40 compared with spot closing of 221.45. The number of contracts traded were 25,254.             

Axis Bank March 2016 futures traded at a discount of 0.15 points at 417.15 compared with spot closing of 417.30. The number of contracts traded were 17,329.                

Bank of Baroda March 2016 futures traded at a discount of 0.15 points at 148.85 compared with spot closing of 149.00. The number of contracts traded were 11,580.       

Tata Motors March 2016 futures traded at a premium of 0.95 points at 343.95 compared with spot closing of 343.00. The number of contracts traded were 11,553.    

Among Nifty calls, 7500 SP from the March month expiry was the most active call with an addition of 0.71 million open interests. Among Nifty puts, 7200 SP from the March month expiry was the most active put with an addition of 0.38 million open interests. The maximum OI outstanding for Calls was at 7500 SP (5.84 mn) and that for Puts was at 7000 SP (7.09 mn). The respective Support and Resistance levels of Nifty are: Resistance 7512.80 --- Pivot Point 7478.45 --- Support --- 7451.00.            

The Nifty Put Call Ratio (PCR) finally stood at 1.14 for March month contract. The top five scrips with highest PCR on OI were Indian Overseas Bank (3.55), Divis Laboratories (3.38), Granules India (2.17), Gail India (1.62) and ITC (1.41).  

Among most active underlying, State Bank of India witnessed a contraction of 3.67 million of Open Interest in the March month futures contract, followed by ICICI Bank witnessing an addition of 1.82 million of Open Interest in the March month contract; Tata Steel  witnessed a contraction of 0.36 million of Open Interest in the March month contract, Axis Bank witnessed an addition of 0.24 million of Open Interest in the March month contract and Tata Motors witnessed an addition of 0.11 million units of Open Interest in the March month's future contract.