Nifty re-conquers 9650 mark; banks, metal stocks rise

Recouping most of its previous week's losses, Indian equity benchmark -- Nifty -- saw a steep spike on Monday to end the session with gains of around three-fourth of a percent, buoyed on positive global cues along with progress made on the GST front. The GST Council relaxed return filing rules for India Inc for the first two months of the rollout of the new indirect tax regime to obviate any lack of preparedness and also approved the creation of an anti-profiteering authority that will exist for two years. Shares of major banks rose on reports that Prime Minister Narendra Modi will review the measures taken by the Reserve Bank of India (RBI) to resolve the non-performing assets (NPA) issue of the Indian state-run banks. Investors got some confidence with the report that Securities and Exchange Board of India (SEBI) is again extending a helping hand to the government and the Reserve Bank of India (RBI) in their fight against bad loans. SEBI is planning to ease the acquisition rules to allow investors to buy distressed assets from banks. Meanwhile, the Department of Industrial Policy and Promotion (DIPP) constituted the Goods and Services Tax (GST) facilitation cell to address any tax issue that can come up in sectors related to the Department and this cell will also help to facilitate the rollout of GST.

Traders were seen piling up positions in Banking, Financial Services and Metal stocks, while selling was witnessed only in Realty and Pharma stocks.  The top gainers from the F&O segment were Balkrishna Industries, Tata Elxsi and V-Guard Industries. On the other hand, the top losers were Wockhardt, IDBI Bank and Voltas. In the index option segment, maximum OI continues to be seen in the 9500-10000 calls and 9000-9700 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 2.63% and reached 10.62. The 50-share Nifty was up by 69.50 points or 0.72% to settle at 9,657.55.

Nifty June 2017 futures closed at 9675.25 on Monday at a premium of 17.70 points over spot closing of 9657.55, while Nifty July 2017 futures ended at 9694.70, at a premium of 37.15 points over spot closing. Nifty June futures saw a contraction of 0.09 million (mn) units, taking the total outstanding open interest (OI) to 21.12 million (mn) units. The near month derivatives contract will expire on June 29, 2017.

From the most active contracts, Tata Steel June 2017 futures traded at a premium of 0.05 points at 520.45 compared with spot closing of 520.40. The numbers of contracts traded were 19,737.

Reliance Industries June 2017 futures traded at a premium of 3.55 points at 1410.55 compared with spot closing of 1407.00. The numbers of contracts traded were 18,657.

Axis Bank June 2017 futures traded at a premium of 4.00 points at 522.00 compared with spot closing of 518.00. The numbers of contracts traded were 13,657.

Yes Bank June 2017 futures traded at a premium of 6.75 points at 1435.20 compared with spot closing of 1428.45. The numbers of contracts traded were 10,858.

Vedanta June 2017 futures traded at a premium of 0.55 points at 242.25 compared with spot closing of 241.70. The numbers of contracts traded were 10,775.

Among Nifty calls, 9700 SP from the June month expiry was the most active call with a contraction of 1.02 million open interests. Among Nifty puts, 9600 SP from the June month expiry was the most active put with an addition of 0.42 million open interests. The maximum OI outstanding for Calls was at 9700 SP (6.57 mn) and that for Puts was at 9500 SP (6.31 mn). The respective Support and Resistance levels of Nifty are: Resistance 9682.27--- Pivot Point 9648.58--- Support --- 9623.87.

The Nifty Put Call Ratio (PCR) finally stood at 1.18 for June month contract. The top five scrips with highest PCR on OI were Amara Raja Batteries (2.40), Oriental Bank of Commerce (1.97), HDFC Bank (1.21), KPIT Technologies (1.19) and Cipla (1.16).

Among most active underlying, Reliance Industries witnessed a contraction of 0.15 million units of Open Interest in the June month futures contract, followed by Tata Steel witnessing a contraction of 0.45 million units of Open Interest in the June  month contract, Indiabulls Real Estate witnessed an addition of 12.97 million units of Open Interest in the June month contract, State Bank of India witnessed a contraction of 2.33 million units of Open Interest in the June  month future contract and Maruti Suzuki India witnessed an addition of 0.07 million units of Open Interest in the June month future contract.