Nifty hits new all time high, ends above 9350 mark

Maintaining momentum for the third consecutive session, Indian equity benchmark -- Nifty -- hits new peak on Wednesday and ended at fresh closing high, ahead of expiry of April derivative contracts which is due tomorrow. Traders remained positive with India Manufacturing Barometer (IMB) Survey, a joint survey conducted by FICCI and PwC Strategy, stating that despite some bold but disruptive policy reforms like demonetization along with global uncertainty, India continues to be one of the fastest growing economies globally. The survey pointed that Indian companies are optimistic about the prospects of the Indian economy more than the global economy; about 63 per cent of the surveyed respondents expect that growth will be in the range of 7-8 per cent. Rising global optimism on French elections results and likely announcement of tax reforms by Donald Trump in the US also pushed the market higher. Furthermore, Niti Aayog has released a draft, three year action agenda for public consultation, which suggests a host of reforms with the objective of accelerating economic growth and increasing employment opportunities. The agenda proposes to check tax evasion & expand tax base, to double the income of farmers by 2022, to bring down land prices to make housing affordable through increased supply of urban land, adoption of consumer-friendly measures such as provision of electricity to all households by 2022.

Traders were seen piling up positions in FMCG, Auto and Banking stocks, while selling was witnessed in IT, Media and Realty stocks. The top gainers from the F&O segment were CEAT, Apollo Hospitals Enterprise and NIIT Technologies. On the other hand, the top losers were Adani Enterprises, Housing Development & Infrastructure and Hindustan Petroleum Corporation. In the index option segment, maximum OI continues to be seen in the 9100-9500 calls and 8500-9300 puts indicating this is the trading range expectation.

The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility increased by 5.24% and reached 11.74. The 50-share Nifty was up by 45.25 points or 0.49% to settle at 9,351.85.

Nifty April 2017 futures closed at 9342.10 on Wednesday at a discount of 9.75 points over spot closing of 9351.85, while Nifty May 2017 futures ended at 9363.30, at a premium of 11.45 points over spot closing. Nifty April futures saw a contraction of 0.99 million (mn) units, taking the total outstanding open interest (OI) to 15.77 million (mn) units. The near month derivatives contract will expire on April 27, 2017.

From the most active contracts, HDFC Bank April 2017 futures traded at a discount of 7.25 points at 1545.70 compared with spot closing of 1,552.95. The numbers of contracts traded were 33,967.

Axis Bank April 2017 futures traded at a premium of 0.45 points at 516.65 compared with spot closing of 516.20. The numbers of contracts traded were 29,474.

Infosys April 2017 futures traded at a premium of 2.70 points at 916.85 compared with spot closing of 914.15. The numbers of contracts traded were 26,555 .

ICICI Bank April 2017 futures traded at a premium of 0.15 point at 276.55 compared with spot closing of 276.40. The numbers of contracts traded were 21,581.

Tata Motors April 2017 futures traded at a premium of 0.30 points at 451.30 compared with spot closing of 451.00. The numbers of contracts traded were 20,406.

Among Nifty calls, 9400 SP from the April month expiry was the most active call with an addition of 0.34 million open interests. Among Nifty puts, 9300 SP from the April month expiry was the most active put with an addition of 0.95 million open interests. The maximum OI outstanding for Calls was at 9400 SP (4.10 mn) and that for Puts was at 9100 SP (4.74 mn). The respective Support and Resistance levels of Nifty are: Resistance 9378.78--- Pivot Point 9340.07--- Support --- 9313.13.

The Nifty Put Call Ratio (PCR) finally stood at 1.84 for April month contract. The top five scrips with highest PCR on OI were BOSCH (1.80), United Breweries (1.55), Bajaj Finance (1.29), Bharti Airtel (1.21) and TVS Motor (1.20).

Among most active underlying, Reliance Industries witnessed a contraction of 1.43 million units of Open Interest in the April month futures contract, followed by State Bank of India witnessing a contraction of 13.14 million units of Open Interest in the April  month contract, Axis Bank witnessed a contraction of 7.00  million units of Open Interest in the April month contract, HDFC Bank witnessed a contraction of 5.68 million units of Open Interest in the April  month future contract and Punjab National Bank  witnessed a contraction of 4.30 million units of Open Interest in the April  month future contract.