The local benchmark Nifty traded with volatility and closed the session with gains of around 0.40% on Monday amid firm global cues. The index started the trade on a positive note as traders took some support from Prime Minister Narendra Modi’s statement that the Indian economy is on track and is going in the right direction on back of various reforms and hard decisions. He also assured that the government will continue to take important decisions regarding the economic reforms. Traders also remained optimistic with Revenue Secretary Hasmukh Adhia’s statement that the policymakers are considering steps to ease the compliance burden related to the goods and services tax (GST) on small businesses and to make product classification for taxation less complicated. Some relief also came with the private report stating that the Indian economy is expected to see a rebound in the July-September quarter of this year with a GVA growth rate of 6.3 percent. However, gains remained capped as traders remained watchful ahead of October F&O expiry and Infosys earnings due later this week.
Traders were seen piling up positions in IT, Realty and Metal stocks, while selling was witnessed in Financial Services, FMCG and Pharma stocks. The top gainers from the F&O segment were Torrent Power, Idea Cellular and GMR Infrastructure. On the other hand, the top losers were PC Jeweller, Biocon and Dish TV India. In the index option segment, maximum OI continues to be seen in the 9900-10500 calls and 9500-10200 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 0.56% and reached 12.32. The 50-share Nifty was up by 38.30 points or 0.38% to settle at 10,184.85.
Nifty October 2017 futures closed at 10189.70 on Monday at a premium of 4.85 points over spot closing of 10184.85, while Nifty November 2017 futures ended at 10224.25 at a premium of 39.40 points over spot closing. Nifty October futures saw a contraction of 1.72 million (mn) units, taking the total outstanding open interest (OI) to 24.39 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 discount of 1.95 point at 938.15 compared with spot closing of 940.10. The numbers of contracts traded were 30,004.
Bharti Airtel October 2017 futures traded at a premium of 0.15 points at 497.20 compared with spot closing of 497.05. The numbers of contracts traded were 24,520.
Axis Bank October 2017 futures traded at a premium of 1.10 points at 450.90 compared with spot closing of 449.80. The numbers of contracts traded were 22,440.
Infosys October 2017 futures traded at a discount of 0.40 points at 940.55 compared with spot closing of 940.95. The numbers of contracts traded were 21,390.
HDFC Bank October 2017 futures traded at a discount of 1.40 points at 1864.45 compared with spot closing of 1865.85. The numbers of contracts traded were 18,567.
Among Nifty calls, 10200 SP from the October month expiry was the most active call with a contraction of 0.29 million open interests. Among Nifty puts, 10100 SP from the October month expiry was the most active put with an addition of 0.93 million open interests. The maximum OI outstanding for Calls was at 10200 SP (4.37 mn) and that for Puts was at 10000 SP (6.97 mn). The respective Support and Resistance levels of Nifty are: Resistance 10231.17--- Pivot Point 10177.83--- Support --- 10131.52.
The Nifty Put Call Ratio (PCR) finally stood at 1.49 for October month contract. The top five scrips with highest PCR on OI were Oracle Financial Services Software (1.87), Ramco Cements (1.83), Bharti Airtel (1.66), V-Guard Industries (1.58) and Kajaria Ceramics (1.58).
Among most active underlying, Reliance Industries witnessed a contraction of 1.02 million units of Open Interest in the October month futures contract, followed by Bharti Airtel witnessing a contraction of 3.15 million units of Open Interest in the October month contract, Axis Bank witnessed a contraction of 3.47 million units of Open Interest in the October month contract, Idea Cellular witnessed a contraction of 9.91 million units of Open Interest in the October month contract and Maruti Suzuki India witnessed a contraction of 0.17 million units of Open Interest in the October month future contract.
