Nifty ends at fresh record closing high; settles above 10,350 mark

The local benchmark Nifty ended at fresh record closing high on Monday, supported by firm global cues. The index traded on a strong note throughout the day with taking comfort from the report that the Centre released Rs 8,698 crore to states to compensate them for revenue loss following GST implementation. Adding to the gains, the private report stated that the government’s recapitalization plan for public sector banks is likely to propel credit growth by up to 700 basis points to 15% and as consequence push up GDP numbers to 7% in the next fiscal. Traders were also optimistic as foreign investors have pumped in close to $3 billion in the Indian capital markets so far this month due to high nominal and real yields and stable macroeconomic conditions. Some support also came with the report that the Reserve Bank is likely to cut rates at its December 6 policy review meet as retail inflation remains muted and the October number is expected to be about 3.3 percent. The market participants overlooked the CBEC chairperson Vanaja N Sarna’s statement that disruption caused by the goods and services tax (GST) rollout may hamper government’s indirect revenue collection target for the year 2017-18.

Traders were seen piling up positions in Pharma, Realty and PSU Banking stocks, while selling was witnessed in FMCG, Metal and IT stocks. The top gainers from the F&O segment were Jet Airways (India), Syndicate Bank and Indiabulls Real Estate. On the other hand, the top losers were Kaveri Seed Company, IDFC and Berger Paints. In the index option segment, maximum OI continues to be seen in the 10300-10700 calls and 9800-10300 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 12.11. The 50-share Nifty was up by 40.60 points or 0.39% to settle at 10363.65.

Nifty November 2017 futures closed at 10388.45 on Monday at a premium of 24.80 points over spot closing of 10363.65, while Nifty December 2017 futures ended at 10424.05 at a premium of 60.40 points over spot closing. Nifty November futures saw an addition of 0.53 million (mn) units, taking the total outstanding open interest (OI) to 23.48 mn units. The near month derivatives contract will expire on November 30, 2017.

From the most active contracts, Lupin November 2017 futures traded at a premium of 7.90 point at 1032.90 compared with spot closing of 1025.00. The numbers of contracts traded were 49,522.

ICICI Bank November 2017 futures traded at a premium of 0.25 points at 300.90 compared with spot closing of 300.65. The numbers of contracts traded were 28,147.

Tata Steel November 2017 futures traded at a premium of 4.30 points at 724.00 compared with spot closing of 719.70. The numbers of contracts traded were 23,774.

State Bank of India November 2017 futures traded at a premium of 1.10 points at 314.10 compared with spot closing of 313.00. The numbers of contracts traded were 18,758.

Punjab National Bank November 2017 futures traded at a premium of 1.45 points at 204.65 compared with spot closing of 203.20. The numbers of contracts traded were 17,859.

Among Nifty calls, 10500 SP from the November month expiry was the most active call with a contraction of 0.18 million open interests. Among Nifty puts, 10300 SP from the November month expiry was the most active put with an addition of 0.57 million open interests.  The maximum OI outstanding for Calls was at 10400 SP (3.25 mn) and that for Puts was at 10000 SP (4.89 mn). The respective Support and Resistance levels of Nifty are: Resistance 10384.00--- Pivot Point 10364.15--- Support --- 10343.80.

The Nifty Put Call Ratio (PCR) finally stood at 1.22 for November month contract. The top five scrips with highest PCR on OI were Repco Home Finance (10.14), Cholamandalam Investment and Finance Company (7.36),  Nestle India (3.00), Apollo Hospitals Enterprise (1.81) and JSW Energy (1.46).

Among most active underlying, ICICI Bank witnessed a contraction of 1.61 million units of Open Interest in the November month futures contract, followed by Lupin witnessing  an addition of 0.62 million units of Open Interest in the November month contract, State Bank of India witnessed an addition of 4.02 million units of Open Interest in the November month contract, Tata Steel witnessed an addition of  1.94 million units of Open Interest in the November month contract and Reliance Industries witnessed  an addition of 0.02 million units of Open Interest in the November month future contract.