Nifty snaps 5-day losing streak; ends above 9,750 mark

Snapping its 5-day losing streak, Indian equity benchmark -- Nifty -- ended the session in green on Monday, amid easing of geopolitical tensions between US and North Korea. The index traded on a strong note throughout the day, as investors took support with Niti Aayog Vice Chairman Arvind Panagariya’s statement that resolution of bad loans in the banking system is on right track and will open the door to rapid credit expansion and growth. Some support also came with the private report stating that the Indian economy is at the cusp of entering its strongest growth phase and a full blown bull market is yet to play out with the wide-based Nifty expected to touch 11,500 in 2018. Besides, Union Minister of State for Finance and Corporate Affairs Arjun Ram Meghwal’s statement that the number of tax slabs in the Goods and Services Tax (GST) regime would be reduced with improvement in revenue, also aided the sentiments. Traders paid no heed towards wholesale price index (WPI) inflation data which increased to 1.88% in the month of July versus 0.90% in the month of June and 0.63% during the corresponding month of the previous year.

Traders were seen piling up positions in Realty, Metal and Pharma stocks, while selling was witnessed only in IT and PSU stocks. The top gainers from the F&O segment were DLF, Reliance Communications and Suzlon Energy. On the other hand, the top losers were Indo Count Industries, Apollo Hospitals Enterprise and Bosch. In the index option segment, maximum OI continues to be seen in the 9900-10500 calls and 9400-10000 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 5.35% and reached 14.38. The 50-share Nifty was up by 83.35 points or 0.86% to settle at 9,794.15.

Nifty August 2017 futures closed at 9815.60 on Monday at a premium of 21.45 points over spot closing of 9794.15, while Nifty September 2017 futures ended at 9846.90 at a premium of 52.75 points over spot closing. Nifty August futures saw a contraction of 0.48 million (mn) units, taking the total outstanding open interest (OI) to 22.83 million (mn) units. The near month derivatives contract will expire on August 31, 2017.

From the most active contracts, Sun Pharmaceutical Industries August 2017 futures traded at a premium of 1.50 points at 473.40 compared with spot closing of 471.90. The numbers of contracts traded were 36,500.

State Bank of India August 2017 futures traded at a premium of 1.50 points at 279.30 compared with spot closing of 277.80. The numbers of contracts traded were 19,306.

Tata Steel August 2017 futures traded at a discount of 0.25 points at 623.75 compared with spot closing of 624.00. The numbers of contracts traded were 14,504.

Yes Bank August 2017 futures traded at a premium of 10.20 points at 1785.70 compared with spot closing of 1775.50. The numbers of contracts traded were 13,423.

Reliance Capital August 2017 futures traded at a premium of 3.95 points at 777.40 compared with spot closing of 773.45. The numbers of contracts traded were 11,746.

Among Nifty calls, 10000 SP from the August month expiry was the most active call with an addition of 0.12 million open interests. Among Nifty puts, 9700 SP from the August month expiry was the most active put with an addition of 0.85 million open interests. The maximum OI outstanding for Calls was at 10000 SP (5.60 mn) and that for Puts was at 9500 SP (5.57 mn). The respective Support and Resistance levels of Nifty are: Resistance 9824.27--- Pivot Point 9788.18--- Support --- 9758.07.

The Nifty Put Call Ratio (PCR) finally stood at 0.92 for August month contract. The top five scrips with highest PCR on OI were Infibeam Incorporation (1.51), BOSCH (1.50), Nestle India (1.33), Indiabulls Real Estate (1.21) and Bajaj Finance (1.14).

Among most active underlying, State Bank of India witnessed an addition of 1.70 million units of Open Interest in the August month futures contract, followed by Tata Steel witnessing an addition of 0.81 million units of Open Interest in the August month contract, Sun Pharmaceutical Industries witnessed an addition of 1.31 million units of Open Interest in the August month contract, Yes Bank witnessed an addition of 0.06 million units of Open Interest in the August month contract and Reliance Industries witnessed an addition of 0.39 million units of Open Interest in the August month future contract.