Nifty snaps 4-days winning streak; settles below 9900 mark

The local benchmark Nifty snapped the four days winning streak to close in red territory below 9900 mark on Thursday. The index made a positive start but failed to hold its gains for long time and turned volatile as the RBI cut the economic growth forecast for the current fiscal to 6.7 percent from its August forecast of 7.3 percent in view of issues with GST implementation and lower Kharif output estimates. Adding some concerns, Union minister P P Chaudhary said that as many as 4.5 lakh directors may face disqualification for their association with shell companies, as the government steps up its fight against the black money menace. However, the downside remained capped with the report stating that the services sector bounced back to growth in the month of September, as the businesses recovered from the Goods and Services Tax (GST) related contractions, driven by renewed increases in new business and output. The seasonally adjusted Nikkei Services Business Activity Index rose back above the 50.0 no-change mark in September, posting reading at 50.7 from 47.5 in August. Besides, NITI Aayog CEO Amitabh Kant’s statement that while there has been a ‘little bit of dip’ in the Indian economy, it is now bouncing back, too provided some support to the market.

Traders were seen piling up positions in Realty, Media and Metal stocks, while selling was witnessed in Auto, FMCG and IT stocks. The top gainers from the F&O segment were Indo Count Industries, Just Dial and Adani Enterprises. On the other hand, the top losers were ICICI Prudential Life Insurance Company, Tech Mahindra and Suzlon Energy. 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 0.76% and reached 11.71. The 50-share Nifty was down by 26.20 points or 0.26% to settle at 9,888.70.

Nifty October 2017 futures closed at 9908.70 on Thursday at a premium of 20 points over spot closing of 9888.70, while Nifty November 2017 futures ended at 9939.10 at a premium of 50.40 points over spot closing. Nifty October futures saw an addition of 0.94 million (mn) units, taking the total outstanding open interest (OI) to 23.36 mn units. The near month derivatives contract will expire on October 26, 2017.

From the most active contracts, Dewan Housing Finance Corporation October 2017 futures traded at a premium of 0.85 point at 560.60 compared with spot closing of 559.75. The numbers of contracts traded were 14,150.

Aurobindo Pharma October 2017 futures traded at a discount of 0.25 points at 744.00 compared with spot closing of 744.25. The numbers of contracts traded were 11,959.

Yes Bank October 2017 futures traded at a premium of 1.30 points at 361.25 compared with spot closing of 359.95. The numbers of contracts traded were 11,385.

Reliance Industries October 2017 futures traded at a premium of 1.45 points at 825.45 compared with spot closing of 824.00. The numbers of contracts traded were 10,327.

BEML October 2017 futures traded at a premium of 5.15 points at 1730.15 compared with spot closing of 1725.00. The numbers of contracts traded were 10,194.

Among Nifty calls, 10000 SP from the October month expiry was the most active call with an addition of 0.46 million open interests. Among Nifty puts, 9,900 SP from the October month expiry was the most active put with an addition of 0.13 million open interests.  The maximum OI outstanding for Calls was at 10000 SP (4.77 mn) and that for Puts was at 9800 SP (4.68 mn). The respective Support and Resistance levels of Nifty are: Resistance 9929.15--- Pivot Point 9905.50--- Support --- 9865.05.

The Nifty Put Call Ratio (PCR) finally stood at 0.95 for October month contract. The top five scrips with highest PCR on OI were Cholamandalam Investment and Finance Company (7.19), Torrent Pharmaceuticals (4.80), V-Guard Industries (2.44), Kajaria Ceramics (2.24) and JSW Energy (2.06).
 
Among most active underlying, Dewan Housing Finance Corporation witnessed an addition of 1.50 million units of Open Interest in the October month futures contract, followed by Reliance Industries witnessing a contraction of 0.27 million units of Open Interest in the October month contract, BEML witnessed a contraction of 0.04 million units of Open Interest in the October month contract, State Bank of India witnessed an addition of  2.46 million units of Open Interest in the October month contract and Maruti Suzuki India witnessed an addition of 0.08 million units of Open Interest in the October month future contract.
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