Nifty ends with losses on late hour sell off

Indian local benchmark -- Nifty -- ended the day with losses on Wednesday, as the investors turned cautious ahead of the second-quarter earnings of TCS scheduled to be released on October 12. The barometer index was positive for most part of the day with taking support from oil cartel OPEC’s Secretary General Mohammed Barkindo’s statement that India is experiencing some of the greatest structural changes as bold new reforms like note ban and GST have put the country firmly on a sustainable growth path. Some relief also came with former RBI Governor C Rangarajan’s statement that the economy would grow at 6.5% for the year 2017-18. He also said the job opportunities and economic growth of the country are inter-related. However, the market failed to hold gains and slipped into red territory in late afternoon session amid media reports which stated that US warship entered Chinese waters. There were also reports that President Donald Trump discussed a ‘range of options’ with his top military advisors to respond to North Korea’s aggression and prevent it from threatening the US and its allies. Sentiments remained cautious with World Bank’s report which forecasted that India's GDP may slow from 8.6 percent in 2015 to 7.0 percent in 2017 because of disruptions by demonetisation and the GST, and warned that subdued private investment due to internal bottlenecks could put downside pressures on the country's potential growth.

All the sectoral indices ended in red on the NSE except IT. The top gainers from the F&O segment were Bharti Airtel, Petronet LNG and Hindustan Petroleum Corporation. On the other hand, the top losers were Dewan Housing Finance Corporation, Andhra Bank and Syndicate Bank. 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 increased by 5.56% and reached 11.73. The 50-share Nifty was down by 32.15 points or 0.32% to settle at 9,984.80.

Nifty October 2017 futures closed at 9992.50 on Wednesday at a premium of 7.70 points over spot closing of 9984.80, while Nifty November 2017 futures ended at 10023.60 at a premium of 38.80 points over spot closing. Nifty October futures saw an addition of 1.04 million (mn) units, taking the total outstanding open interest (OI) to 25.27 mn units. The near month derivatives contract will expire on October 26, 2017.

From the most active contracts, Reliance Industries October 2017 futures traded at a premium of 3.45 point at 842.45 compared with spot closing of 839.00. The numbers of contracts traded were 15,720.

Tata Steel October 2017 futures traded at a premium of 1.65 points at 684.15 compared with spot closing of 682.50. The numbers of contracts traded were 12,685.

Axis Bank October 2017 futures traded at a premium of 1.30 points at 516.00 compared with spot closing of 514.70. The numbers of contracts traded were 12,417.

Hindustan Petroleum Corporation October 2017 futures traded at a premium of 2.15 points at 454.65 compared with spot closing of 452.50. The numbers of contracts traded were 12,320.

State Bank of India October 2017 futures traded at a premium of 0.75 points at 251.95 compared with spot closing of 251.20. The numbers of contracts traded were 11,393.

Among Nifty calls, 10100 SP from the October month expiry was the most active call with an addition of 0.74 million open interests. Among Nifty puts, 10000 SP from the October month expiry was the most active put with an addition of 0.81 million open interests.  The maximum OI outstanding for Calls was at 10000 SP (5.04 mn) and that for Puts was at 9800 SP (5.37 mn). The respective Support and Resistance levels of Nifty are: Resistance 10049.43--- Pivot Point 10002.62--- Support --- 9937.98.

The Nifty Put Call Ratio (PCR) finally stood at 1.10 for October month contract. The top five scrips with highest PCR on OI were Cholamandalam Investment and Finance Company (6.40), Torrent Pharmaceuticals (4.00), Ramco Cements (2.53), Oracle Financial Services Software (1.89) and Kajaria Ceramics (1.53).
 
Among most active underlying, Tata Steel witnessed a contraction of 0.02 million units of Open Interest in the October month futures contract, followed by Reliance Industries witnessing a contraction of 0.32 million units of Open Interest in the October month contract, State Bank of India witnessed an addition of 2.20 million units of Open Interest in the October month contract, Vedanta  witnessed an addition of  0.95 million units of Open Interest in the October month contract and Maruti Suzuki India witnessed an addition of 0.06 million units of Open Interest in the October month future contract.