Nifty gains for third straight session

Gaining for the third straight session, Indian equity benchmark -- Nifty -- closed with gains of more than half a percent on Friday amid firm global cues. Despite some initial jitters market traded in green throughout the session, as Finance Minister Arun Jaitley put private sector debtors on notice, saying they will have to pay their dues to banks or others will step in and takes control of the businesses. The minister also defended demonetization, declaring that its impact was along expected lines and the economy will benefit from it in the medium and long term. Further, support came with the report stating that India’s manufacturing activity rebounded in the month of August to 51.2 in August, as compared to 47.9 in July, aided by rise in new orders and output across the country. Investors shrugged off weak economic growth data of the June quarter. India's Gross Domestic Product (GDP) growth slowed down to a three-year low of 5.7% during the first quarter (April-June) of the fiscal year 2017-18, as against 7.9% in the corresponding period a year ago and 6.1% in the preceding quarter.

Traders were seen piling up positions in Pharma, Realty and Media stocks, while selling was witnessed only in IT stocks. The top gainers from the F&O segment were Sun TV Network, Dr. Reddy's Laboratories and Hindustan Construction Company. On the other hand, the top losers were Infibeam Incorporation, SREI Infrastructure Finance and Idea Cellular. In the index option segment, maximum OI continues to be seen in the 9800-10500 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 2.32% and reached 11.67. The 50-share Nifty was up by 56.50 points or 0.57% to settle at 9,974.40.

Nifty September 2017 futures closed at 10007.30 on Friday at a premium of 32.90 points over spot closing of 9974.40, while Nifty October 2017 futures ended at 10034.20 at a premium of 59.80 points over spot closing. Nifty September futures saw an addition of 1.04 million (mn) units, taking the total outstanding open interest (OI) to 16.91 mn units. The near month derivatives contract will expire on September 28, 2017.

From the most active contracts, Reliance Capital September 2017 futures traded at a premium of 5.45 points at 858.30 compared with spot closing of 852.85. The numbers of contracts traded were 35,598.

Dr. Reddy's Laboratories September 2017 futures traded at a premium of 9.25 points at 2221.25 compared with spot closing of 2212.00. The numbers of contracts traded were 28,355.

Sun TV Network September 2017 futures traded at a premium of 3.50 points at 771.50 compared with spot closing of 768.00. The numbers of contracts traded were 15,203.

Tata Motors September 2017 futures traded at a premium of 1.80 points at 392.80 compared with spot closing of 391.00. The numbers of contracts traded were 13,898.

Infosys September 2017 futures traded at a premium of 5.90 points at 925.75 compared with spot closing of 919.85. The numbers of contracts traded were 13,864.

Among Nifty calls, 10000 SP from the September month expiry was the most active call with an addition of 0.64 million open interests. Among Nifty puts, 9900 SP from the September month expiry was the most active put with an addition of 1.00 million open interests. The maximum OI outstanding for Calls was at 10000 SP (3.50 mn) and that for Puts was at 9700 SP (4.02 mn). The respective Support and Resistance levels of Nifty are: Resistance 10001.95--- Pivot Point 9955.90--- Support --- 9928.35.

The Nifty Put Call Ratio (PCR) finally stood at 1.16 for September month contract. The top five scrips with highest PCR on OI were KPIT Technologies (2.63), Indiabulls Real Estate (2.04), JSW Energy (2.00), UBL (1.62) and Marico (1.57).

Among most active underlying, Reliance Capital witnessed an addition of 0.76 million units of Open Interest in the September month futures contract, followed by Reliance Industries witnessing a contraction of 0.05 million units of Open Interest in the September month contract, Maruti Suzuki India witnessed a contraction of 0.03 million units of Open Interest in the September month contract, Tata Steel  witnessed an addition  of 0.90 million units of Open Interest in the September month contract and Indiabulls Real Estate witnessed an addition of 8.43 million units of Open Interest in the September month future contract.