Nifty ends flat on higher WPI data

Indian equity benchmark -- Nifty -- ended the session flat with a positive bias on Thursday and settled below 10,100 mark. The index traded volatile throughout the day as traders remained concerned after India has been placed at a low 103 rank, the lowest among BRICS economies, on the WEF’s Global Human Capital Index, which has been topped by Norway. India also ranks among the lowest in the world when it comes to the employment gender gap. Adding some concerns, the latest data released by the government has shown that the wholesale price index (WPI) inflation rate has registered significant increase in August month. Surge in prices of foods articles, vegetable and  fuel products mainly pulled the country’s WPI higher to 3.24% in August against 1.09% increase in the same month a year ago and 1.88% recorded in the previous month. However, the private report stated that India’s GDP growth is expected to be around 7.1% this fiscal following a likely pick up in industrial production as firms resort to restocking post GST especially ahead of festive season, helped the index to keep its head above water. Some support also came with report that India’s first bullet train project which kick-started on Thursday by Prime Minister Narendra Modi and his Japanese counterpart Shinzo Abe, may turn into a catalyst to give a fillip to struggling economies of Asia and Africa.

Traders were seen piling up positions in Pharma, Banking and Auto stocks, while selling was witnessed in Realty, Metal and IT stocks. The top gainers from the F&O segment were Hindustan Construction Company, Piramal Enterprises and Reliance Power. On the other hand, the top losers were Wipro, PC Jeweller and Vedanta. In the index option segment, maximum OI continues to be seen in the 9900-10500 calls and 9500-10100 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 2.42% and reached 11.47. The 50-share Nifty was up by 7.30 points or 0.07% to settle at 10,086.60.

Nifty September 2017 futures closed at 10114.45 on Thursday at a premium of 27.85 points over spot closing of 10086.60, while Nifty October 2017 futures ended at 10144.85 at a premium of 58.25 points over spot closing. Nifty September futures saw an addition of 0.32 million (mn) units, taking the total outstanding open interest (OI) to 20.84 mn units. The near month derivatives contract will expire on September 28, 2017.

From the most active contracts, Bharat Heavy Electricals September 2017 futures traded at a premium of 0.40 points at 137.50 compared with spot closing of 137.10. The numbers of contracts traded were 25,443.

Axis Bank September 2017 futures traded at a discount of 0.85 points at 518.60 compared with spot closing of 519.45. The numbers of contracts traded were 24,568.

Sun Pharmaceutical Industries September 2017 futures traded at a discount of 1.50 points at 521.80 compared with spot closing of 523.30. The numbers of contracts traded were 24,100.

Tata Motors September 2017 futures traded at a premium of 1.60 points at 405.40 compared with spot closing of 403.80. The numbers of contracts traded were 21,885.

Divi's Laboratories September 2017 futures traded at a discount of 9.50 points at 860.75 compared with spot closing of 870.25. The numbers of contracts traded were 17,594.

Among Nifty calls, 10200 SP from the September month expiry was the most active call with an addition of 0.23 million open interests. Among Nifty puts, 10000 SP from the September month expiry was the most active put with an addition of 0.53 million open interests. The maximum OI outstanding for Calls was at 10200 SP (4.35 mn) and that for Puts was at 9900 SP (5.87 mn). The respective Support and Resistance levels of Nifty are: Resistance 10118.62--- Pivot Point 10094.48--- Support --- 10062.47.

The Nifty Put Call Ratio (PCR) finally stood at 1.44 for September month contract. The top five scrips with highest PCR on OI were the Ramco Cements (2.16), Indiabulls Real Estate (2.12), Dewan Housing Finance Corporation (1.26), DCB Bank (1.12) and HDFC Bank (1.07).

Among most active underlying, Bharat Heavy Electricals witnessed an addition of 8.28 million units of Open Interest in the September month futures contract, followed by Vedanta witnessing an addition of 3.96 million units of Open Interest in the September month contract, Reliance Industries witnessed an addition of 0.03 million units of Open Interest in the September month contract, Axis Bank witnessed an addition of  0.61 million units of Open Interest in the September month contract and Tata Motors witnessed an addition of 1.77 million units of Open Interest in the September month future contract.