Nifty closes at fresh record high; surpasses 10,400 mark

Key Indian benchmark Nifty closed at fresh record high on Wednesday, surpassing 10,400 mark. After opening on a strong note, the index continued its rally, as investors remained optimistic with report that eight core sectors grew to a six-month high of 5.2 per cent in September, helped by a robust performance in coal, natural gas and refinery segments. Traders took some encouragement with World Bank’s latest report stating that India has jumped 30 spots to number 100 in the latest Ease of Doing Business report for 2018. The report highlighted that India stands out this year as one of the 10 economies that improved the most in the areas measured by Doing Business. Adding some optimism, department of Industrial Policy and Promotion (DIPP) secretary Ramesh Abhishek said that the government is working with the World Bank to recognise over 200 reforms that will help propel India into the top-50 bracket in ease of doing business. The markets participants overlooked the report stating that growth in India’s manufacturing sector lost momentum in October month. The Nikkei India Manufacturing Purchasing Managers’ Index fell from 51.2 in September to 50.3 in October.

Traders were seen piling up positions in Realty, FMCG and Financial Services stocks, while selling was witnessed in Pharma, IT and Media stocks. The top gainers from the F&O segment were IDFC Bank, Bharti Airtel and Syndicate Bank. On the other hand, the top losers were Eicher Motors, Bharti Infratel and Hexaware Technologies. In the index option segment, maximum OI continues to be seen in the 10300-10700 calls and 9800-10400 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 2.43% and reached 12.13. The 50-share Nifty was up by 105.20 points or 1.02% to settle at 10,440.50.

Nifty November 2017 futures closed at 10477.30 on Wednesday at a premium of 36.80 points over spot closing of 10440.50, while Nifty December 2017 futures ended at 10516.30 at a premium of 75.80 points over spot closing. Nifty November futures saw an addition of 0.58 million (mn) units, taking the total outstanding open interest (OI) to 24.32 mn units. The near month derivatives contract will expire on November 30, 2017.

From the most active contracts, Bharti Airtel November 2017 futures traded at a premium of 0.40 point at 543.40 compared with spot closing of 543.00. The numbers of contracts traded were 35,502.

ICICI Bank November 2017 futures traded at a discount of 0.95 points at 312.40 compared with spot closing of 313.35. The numbers of contracts traded were 28,398.

Axis Bank November 2017 futures traded at a discount of 1.15 points at 534.85 compared with spot closing of 536.00. The numbers of contracts traded were 25,937.

State Bank of India November 2017 futures traded at a discount of 0.20 points at 319.80 compared with spot closing of 320.00. The numbers of contracts traded were 21,000.

Vedanta November 2017 futures traded at a premium of 1.45 points at 344.80 compared with spot closing of 343.35. The numbers of contracts traded were 17,909.

Among Nifty calls, 10500 SP from the November month expiry was the most active call with an addition of 0.35 million open interests. Among Nifty puts, 10300 SP from the November month expiry was the most active put with an addition of 0.51 million open interests.  The maximum OI outstanding for Calls was at 10500 SP (3.42 mn) and that for Puts was at 10000 SP (5.25 mn). The respective Support and Resistance levels of Nifty are: Resistance 10467.08--- Pivot Point 10425.07--- Support --- 10398.48.

The Nifty Put Call Ratio (PCR) finally stood at 1.35 for November month contract. The top five scrips with highest PCR on OI were Repco Home Finance (7.78), Godrej Consumer Products (3.36), JSW Energy (1.57), Apollo Hospitals Enterprise (1.45) and Cholamandalam Investment and Finance Company (1.43).

Among most active underlying, Bharti Airtel witnessed an addition of 5.19 million units of Open Interest in the November month futures contract, followed by ICICI Bank witnessing  an addition of 1.80 million units of Open Interest in the November month contract, Axis Bank witnessed a contraction of 2.34 million units of Open Interest in the November month contract, State Bank of India witnessed a contraction of  2.55 million units of Open Interest in the November month contract and Reliance Industries witnessed  an addition of 0.05 million units of Open Interest in the November month future contract.