Nifty ekes out slender gains

The local benchmark -- Nifty -- ended the volatile day of trade slightly in green terrain. After a positive start market traded cautiously, altering between positive and negative territory but in a tight range, as selling pressure witness after Infosys shares tumbled as much as 5.3 per cent to their lowest since July 20, 2015 after the country’s second-largest IT services firm cut its fiscal-year revenue growth target for a second time in three months on an uncertain business outlook. In second half market gained momentum on hopes of further rate cuts by the central bank after data showed that inflation based on consumer price index dipped to 13-month low in September. Data released by the statistics office showed consumer inflation at 4.31% in September compared with 5.05% in August and 6.07% in July. Investors’ sentiment got further support with the India’s Wholesale Price Index (WPI) in the month of September 2016 also softened to 3.57 percent compared to 3.74 per cent in the previous month. Some support also came with reports that the government may seek parliamentary approval to spend about $7.5 billion more on roads, railways and other public programmes over the next five months. Finally, Nifty managed to keep its head above water.

On the global front, European stocks were trading higher, as better-than-expected inflation data from China lifted market sentiment and as markets focused on upcoming US economic reports, as well as a speech by Federal Reserve Chair Janet Yellen. Asian markets ended mostly in green, with Shanghai bucking a positive trend with prices data from China that gave hopes for renewed demand prospects after disappointing trade data earlier this week.

The top gainers from the F&O segment were L&T Finance Holdings, DHFL and Petronet LNG. On the other hand, the top losers were TV18 Broadcast, Zee Entertainment Enterprises and Apollo Tyres. In the index options segment, maximum OI was being seen in the 8500-9000 calls and 8500-8700 puts.

The India Volatility Index (VIX), a gauge for market's short term expectation of volatility contraction by 3.48% and reached 14.88. The 50-share Nifty was up by 10.05 points or 0.12% to settle at 8,583.40

Nifty October 2016 futures closed at 8605.10 on Friday at a premium of 21.70 points over spot closing of 8,583.40, while Nifty November 2016 futures ended at 8643.35 at a premium of 59.95 points over spot closing. Nifty October futures saw contraction of 0.55 million (mn) units, taking the total outstanding open interest (OI) to 19.24 million (mn) units. The near month derivatives contract will expire on October 27, 2016.

From the most active contracts, State Bank of India October 2016 futures traded at a premium of 0.45 points at 252.35 compared with spot closing of 251.90. The numbers of contracts traded were 11,749.

ICICI Bank October 2016 futures traded at a premium of 0.70 points at 242.90 compared with spot closing of 242.20. The numbers of contracts traded were 9,399.

Axis Bank October 2016 futures traded at a premium of 1.40 points at 523.25 compared with spot closing of 521.85. The numbers of contracts traded were 8,787.

Tata Motors October 2016 futures traded at a discount of 0.55 points at 556.45 compared with spot closing of 557.00. The numbers of contracts traded were 8,857.   

Tata Steel October 2016 futures traded at a premium of 0.80 points at 413.35 compared with spot closing of 412.55. The numbers of contracts traded were 11,131.   

Among Nifty calls, 8600 SP from the October month expiry was the most active call with a addition of 0.16 million open interests. Among Nifty puts, 8600 SP from the October month expiry was the most active put with an addition of 0.13 million open interests. The maximum OI outstanding for Calls was at 9000 SP (6.76 mn) and that for Puts was at 8500 SP (5.40 mn). The respective Support and Resistance levels of Nifty are: Resistance 8608.63--- Pivot Point 8579.22--- Support --- 8553.98.             

The Nifty Put Call Ratio (PCR) finally stood at 0.93 for October month contract. The top five scrips with highest PCR on OI were OFSS (2.00), APOLLOHOSP (1.80), MRF (1.30), LT (1.27) and MARUTI (1.02).   

Among most active underlying Infosys witnessed an contraction of 0.00 million of Open Interest in the October month futures contract, followed TCS witnessing an contraction of 0.40 million of Open Interest in the October month contract, Reliance Industries witnessed a contraction of 0.60 million of Open Interest in the October month contract, SBI witnessed an addition of 1.71 million of Open Interest in the October month contract and Tata Steel witnessed an addition  of 0.03 million units of Open Interest in the October month's future contract.