Nifty ends just shy of 9600 mark; hits all time closing high

Indian equity benchmark -- Nifty -- traded on an extremely strong note on Friday to close at record closing high on sustained foreign capital inflows amid robust earnings. A slow pace in interest rate hike by FED and expectation on good monsoon continued to weigh the sentiments. The private weather forecaster - Skymet reported that the increase in pre-monsoon showers across India is hinting at the arrival of monsoon 2017, which is not very far away. The weather forecasting agency predicted that monsoon will make an onset over Kerala by May 29, with a margin of error of three days. Investors also remained positive with the report that India remains number one in the world as the world’s topmost green-field FDI investment destination for the second consecutive year. India attracted $62.3 billion in 2016, putting China and the US in second and third place respectively, as far as FDI inflows were concerned last year. Meanwhile, the rollover percentage of the Nifty futures for the May series stood at 74%, which is higher than the average rollovers of 69% in last three series, while the market-wide rollovers came in at 76% as compared to the average rollovers of 75% in the last three series.

Traders were seen piling up positions in Metal, Media and FMCG stocks, while selling was witnessed in Pharma, PSU and IT stocks. The top gainers from the F&O segment were Sintex Industries, Hindustan Petroleum Corporation and Jaiprakash Associates.  On the other hand, the top losers were RBL Bank, Infibeam Incorporation and Sun Pharmaceutical Industries.  In the index option segment, maximum OI continues to be seen in the 9400-10000 calls and 9000-9600 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 3.97% and reached 10.86. The 50-share Nifty was up by 85.35 points or 0.90% to settle at 9,595.10.

Nifty June 2017 futures closed at 9575.80 on Friday at a discount of 19.30 points over spot closing of 9595.10, while Nifty July 2017 futures ended at 9589.95, at a discount of 5.15 points over spot closing. Nifty June futures saw a contraction of 0.14 million (mn) units, taking the total outstanding open interest (OI) to 18.96 million (mn) units. The near month derivatives contract will expire on June 29, 2017.

From the most active contracts, Hindustan Petroleum Corporation June 2017 futures traded at a discount of 0.95 points at 568.15 compared with spot closing of 569.10. The numbers of contracts traded were 30,859.

Tata Steel June 2017 futures traded at a premium of 1.55 points at 512.85 compared with spot closing of 511.30. The numbers of contracts traded were 26,531.

Reliance Industries June 2017 futures traded at a discount of 0.35 points at 1338.65 compared with spot closing of 1339.00. The numbers of contracts traded were 22,601.

ITC June 2017 futures traded at a discount of 1.00 points at 305.10 compared with spot closing of 306.10. The numbers of contracts traded were 22,480.

Sun Pharmaceutical Industries June 2017 futures traded at a premium of 5.75 points at 571.50 compared with spot closing of 565.75. The numbers of contracts traded were 18,449.

Among Nifty calls, 9600 SP from the June month expiry was the most active call with an addition of 0.51 million open interests. Among Nifty puts, 9500 SP from the June month expiry was the most active put with an addition of 1.52 million open interests. The maximum OI outstanding for Calls was at 9600 SP (3.90 mn) and that for Puts was at 9400 SP (4.59 mn). The respective Support and Resistance levels of Nifty are: Resistance 9634.87--- Pivot Point 9565.13--- Support --- 9525.37.

The Nifty Put Call Ratio (PCR) finally stood at 1.08 for June month contract. The top five scrips with highest PCR on OI were V-Guard Industries (2.75), Torrent Pharmaceuticals (2.56), Aditya Birla Nuvo (2.12), Ajanta Pharma (1.75) and Indraprastha Gas (1.64).

Among most active underlying, Tata Steel  witnessed an addition of 1.12 million units of Open Interest in the June month futures contract, followed by Reliance Industries witnessing an addition of 0.01 million units of Open Interest in the June  month contract, ITC witnessed an addition of 1.56 million units of Open Interest in the June month contract, Hindustan Petroleum Corporation witnessed an addition of 1.06 million units of Open Interest in the June  month future contract and State Bank of India witnessed an addition of 1.14 million units of Open Interest in the June month future contract.