Nifty ends at all time high above 9,400 mark

The local equity benchmark -- Nifty -- soared high throughout the day and ended at all time high above 9,400 mark on Wednesday as Indian Meteorological Department’s (IMD) new monsoon forecast raised prospects of higher agricultural and economic growth. It said that the country is likely to receive above average monsoon rainfall this year and noted that it could reach 100 per cent of the long period average (LPA) instead of 96 percent of the LPA as predicted in its earlier forecast on April 18, 2017. Investors’ sentiments also remained optimistic with the private report that Indian business leaders are the most confident among the world’s 10 largest economies. The confidence of Indian leaders rose 3.2 points to 66 in the first quarter of 2017, reversing the decline seen in the fourth quarter of 2016, when confidence dipped in the immediate aftermath of the government’s decision to invalidate old high-value currency notes. Some support also came with commerce & industry minister Nirmala Sitharaman stating that India’s manufacturing policy will soon be overhauled with the objective of creating more jobs in an environment where technology is rapidly replacing labour. 

Traders were seen piling up positions in Media, FMCG and Auto stocks, while selling was witnessed only in IT and PSU stocks. The top gainers from the F&O segment were Bharti Airtel, CG Power & Industrial Solutions and NIIT Technologies. On the other hand, the top losers were IDBI Bank, Biocon and CEAT. In the index option segment, maximum OI continues to be seen in the 9200-9700 calls and 8500-9400 puts indicating this is the trading range expectation.

The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility decreased by 1.48% and reached 10.94. The 50-share Nifty was up by 90.45 points or 0.97% to settle at 9,407.30.

Nifty May 2017 futures closed at 9419.20 on Wednesday at a premium of 11.90 points over spot closing of 9,407.30, while Nifty June 2017 futures ended at 9416.45, at a premium of 9.15 points over spot closing. Nifty May futures saw an addition of 1.29 million (mn) units, taking the total outstanding open interest (OI) to 20.66 million (mn) units. The near month derivatives contract will expire on May 25, 2017.

From the most active contracts, Bharti Airtel May 2017 futures traded at a discount of 0.40 points at 372.40 compared with spot closing of 372.80. The numbers of contracts traded were 25,353.

Reliance Industries May 2017 futures traded at a premium of 0.25 points at 1359.45 compared with spot closing of 1,359.20. The numbers of contracts traded were 22,893.

Axis Bank May 2017 futures traded at a premium of 1.50 points at 527.10 compared with spot closing of 525.60. The numbers of contracts traded were 20,380.

ICICI Bank May 2017 futures traded at a premium of 0.65 points at 299.55 compared with spot closing of 298.90. The numbers of contracts traded were 14,194.

Aurobindo Pharma May 2017 futures traded at a premium of 0.50 points at 619.50 compared with spot closing of 619.00. The numbers of contracts traded were 12,318.

Among Nifty calls, 9400 SP from the May month expiry was the most active call with a contraction of 1.15 million open interests. Among Nifty puts, 9300 SP from the May month expiry was the most active put with an addition of 1.60 million open interests. The maximum OI outstanding for Calls was at 9500 SP (6.51 mn) and that for Puts was at 9300 SP (7.67 mn). The respective Support and Resistance levels of Nifty are: Resistance 9436.03--- Pivot Point 9386.02--- Support --- 9357.28.

The Nifty Put Call Ratio (PCR) finally stood at 1.17 for May month contract. The top five scrips with highest PCR on OI were Infibeam Incorporation (2.45), Bharti Airtel (2.05), CEAT (1.39), Eicher Motors (1.38) and Britannia Industries (1.31).

Among most active underlying, Reliance Industries witnessed a contraction of 0.78 million units of Open Interest in the May month futures contract, followed by Bharti Airtel witnessing an addition of 2.11 million units of Open Interest in the May  month contract, Axis Bank witnessed an addition of 0.85 million units of Open Interest in the May month contract, ICICI Bank witnessed a contraction of 0.93 million units of Open Interest in the May  month future contract and Canara Bank witnessed an addition of 1.57 million units of Open Interest in the May month future contract.