Nifty ends at 18 month high; settles above 8,950 mark

Buoyed by firm global cues, the Indian benchmark -- Nifty -- finished the session on cheerful note, hitting 18 month high. After a negative opening, market traded subdued in early deals, as traders remained on sidelines ahead of European Central Bank’s policy decision due later in the day. Afterwards, market gained strength and entered into green terrain, as sentiment got boost with Finance Minister Arun Jaitley’s statement that the government is running against time for the implementation of GST, but added that he would certainly like to give it a try. He said the new GST, once implemented, would have a transformational impact by creating a common market in the country, while also acting as a transfer mechanism that would aid poorer states. Markets extended its northward journey in second half of trade and managed to end with a gain of around half a percent, recapturing its crucial 8,950 mark. Some support also came with Economic Affairs Secretary Shaktikanta Das’ statement that implementation of the goods and services tax will bring small and medium enterprises (SMEs) into the national value chain and committed many more reforms.

Positive opening in European counterparts too provided strength to domestic market. European stocks were mostly higher ahead of cautious European Central Bank’s policy decision due later in the day, while Asian shares ended near one year high on Thursday as Chinese trade data topped forecasts and imports recorded their first annual rise since late 2014.

Back home, barring IT and Private Bank, all sectoral indices on the NSE ended in the green territory with Realty index being the clear leader in the sectoral front after rising 2.87% followed by Pharma which added 2.61%. Inscrip specific developments, IRB Infrastructure soared 8.2% after an investment trust backed by the construction company, IRB InvIT Fund, filed a draft offer document with Sebi for an initial public offer (IPO). Tata Steel rises tracking gains in global metal prices following positive Chinese data. On other hand, TCS fell after the company said its financial sector clients in the United States are holding back on discretionary spending. Yes Bank declined after the private sector lender launched a qualified institutional placement (QIP) issue to raise $1 billion.

The top gainers from the F&O segment were IRB Infrastructure Developers, HDIL and GMR Infrastructure. On the other hand, the top losers were Yes Bank, TCS and Motherson Sumi Systems. In the index options segment, maximum OI was being seen in the 8900-9100 calls and 8600-9000 puts.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility contraction by 0.23% and reached 13.11. The 50-share Nifty was up by 34.55 points or 0.39% to settle at 8,952.50

Nifty September 2016 futures closed at 8982.55 on Thursday at a premium of 30.05 points over spot closing of 8,952.50, while Nifty October 2016 futures ended at 9021.05 at a premium of 68.55 points over spot closing. Nifty September futures saw addition of 0.34 million (mn) units, taking the total outstanding open interest (OI) to 34.34 million (mn) units. The near month derivatives contract will expire on September 29, 2016.

From the most active contracts, BHEL September 2016 futures traded at a premium of 0.90 points at 157.10 compared with spot closing of 156.20. The numbers of contracts traded were 20,117.

Axis Bank September 2016 futures traded at a premium of 3.70 points at 632.60 compared with spot closing of 628.90. The numbers of contracts traded were 14,026.

Sun Pharmaceuticals Industries September 2016 futures traded at a premium of 1.80 points at 809.70 compared with spot closing of 807.90. The numbers of contracts traded were 19,001.

Reliance Industries September 2016 futures traded at a premium of 3.15 points at 1037.15 compared with spot closing of 1,034.00. The numbers of contracts traded were 13,707.   

Tata Steel September 2016 futures traded at a premium of 2.45 points at 404.75 compared with spot closing of 402.30. The numbers of contracts traded were 18,900.   

Among Nifty calls, 9000 SP from the September month expiry was the most active call with a addition of 0.03 million open interests. Among Nifty puts, 8900 SP from the September month expiry was the most active put with an addition of 0.63 million open interests. The maximum OI outstanding for Calls was at 9000 SP (5.58 mn) and that for Puts was at 8600 SP (6.06 mn). The respective Support and Resistance levels of Nifty are: Resistance 8976.57--- Pivot Point 8936.28--- Support --- 8912.22.             

The Nifty Put Call Ratio (PCR) finally stood at 1.43 for September month contract. The top five scrips with highest PCR on OI were MRF (8.00), MARUTI (1.60), TATAMOTORS (1.22), ULTRACEMCO (1.21) and BHARTIARTL (1.11).   

Among most active underlying Yes Bank witnessed an addition of 1.21 million of Open Interest in the September month futures contract, followed BHEL witnessing an contraction of 1.11 million of Open Interest in the September month contract, Tata Steel witnessed a contraction  of 0.59 million of Open Interest in the September month contract, Maruti Suzuki India witnessed an addition  of 0.05 million of Open Interest in the September month contract and State Bank of India witnessed an addition  of 0.03 million units of Open Interest in the September month's future contract.