Nifty extend yesterday’s rally; settles above 8750 level

The local benchmark -- Nifty -- traded in green throughout the day and ended with a gain of almost half a percent on Wednesday. After a positive opening, market traded with traction, as sentiment remained upbeat with the FICCI survey that India’s economy is likely to expand 7.8% during the current financial year on the back of good monsoons. The estimated median GVA (gross value added) growth for Q1 FY17 has been put at 7.6%. Buying got intensified in second half of trade with the Finance Minister Arun Jaitley stating that it is logical to hope for a rate cut by Reserve Bank of India (RBI) though the actual decision will have to be taken by the central bank. However, market participants booked some of their profit at higher levels in last leg of trade ahead of the release of economic growth data later in the day. Finally nifty managed to end the session tad below its crucial 8,800 mark with a gain of over forty points.

On global front, European stocks were trading lower despite upbeat German retail sales data. Investors remained cautious ahead of the release of a US jobs report due later in the day, while Asian markets ended mixed on Wednesday, with investors looking ahead to China PMI data this week and taking note of regional data in Japan.

The top gainers from the F&O segment were IDFC, Power Finance Corporation and Rural Electrification Corporation. On the other hand, the top losers were DLF, Kaveri Seed Company and Shriram Transport Finance Company. In the index options segment, maximum OI was being seen in the 8700-9000 calls and 8500-8800 puts.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility addition by 1.71% and reached 13.24. The 50-share Nifty was up by 41.85 points or 0.48% to settle at 8,786.20

Nifty September 2016 futures closed at 8836.15 on Wednesday at a premium of 49.95 points over spot closing of 8,786.20, while Nifty October 2016 futures ended at 8876.70 at a premium of 90.50 points over spot closing. Nifty September futures saw addition of 2.57 million (mn) units, taking the total outstanding open interest (OI) to 33.02 million (mn) units. The near month derivatives contract will expire on September 29, 2016.

From the most active contracts, State Bank of India September 2016 futures traded at a premium of 2.35 points at 253.95 compared with spot closing of 251.60. The numbers of contracts traded were 16,643.

ICICI Bank September 2016 futures traded at a premium of 1.30 points at 259.15 compared with spot closing of 257.85. The numbers of contracts traded were 14,233.

DLF September 2016 futures traded at a premium of 1.45 points at 156.05 compared with spot closing of 154.60. The numbers of contracts traded were 12,794.

Axis Bank September 2016 futures traded at a premium of 3.00 points at 598.85 compared with spot closing of 595.85. The numbers of contracts traded were 53,383.   

HDFC Bank September 2016 futures traded at a premium of 5.50 points at 1296.50 compared with spot closing of 1,291.00. The numbers of contracts traded were 12,311.   

Among Nifty calls, 8900 SP from the September month expiry was the most active call with a addition of 0.38 million open interests. Among Nifty puts, 8600 SP from the September month expiry was the most active put with an addition of 0.22 million open interests. The maximum OI outstanding for Calls was at 9000 SP (5.79 mn) and that for Puts was at 8500 SP (6.29 mn). The respective Support and Resistance levels of Nifty are: Resistance 8818.92--- Pivot Point 8786.48--- Support --- 8753.77.             

The Nifty Put Call Ratio (PCR) finally stood at 1.21 for September month contract. The top five scrips with highest PCR on OI were GRASIM (1.35), PCJEWELLER (1.33), BHARATFORG (1.17), M&M (1.13) and TATAMOTORS (1.09).   

Among most active underlying Axis Bank witnessed an addition of 12.95 million of Open Interest in the September month futures contract, followed Tata Motors witnessing an addition of 0.61 million of Open Interest in the September month contract, Yes Bank witnessed a addition  of 3.56 million of Open Interest in the September month contract, State Bank of India witnessed an addition  of 0.53 million of Open Interest in the September month contract and Reliance Industries witnessed an addition  of 0.12 million units of Open Interest in the September month's future contract.