Nifty ends flat with positive bias; holds 10,300 mark

The local benchmark Nifty ended flat with positive bias on Thursday, holding its psychological level of 10,300 mark. The index made a positive start but failed to hold the momentum in the second half as investors turned pessimistic with Grant Thornton’s latest International Business Report (IBR) highlighting that India slipped to the 7th position in the September quarter from the 2nd spot in the previous three months in its ‘business optimism index’, showing clear signs of lag in the economy. The market participants also took note of the finance ministry’s statement that raising the individual limit of foreign investment up to 15% in power exchanges would be unwise unless a clear business case is established and a strong and adequate regulatory mechanism exists. However, at the end of session, the index erased all the losses and came back into the positive terrain with taking support from the report that India has opted for a digital pathway to move at an unprecedented rate into the future. Some support also came from the joint study of Assocham and Resurgent which stated that India's textiles sector is likely to touch $ 250 billion in the next two years from the current level of $ 150 billion.

Traders were seen piling up positions in PSU Banking, Metal and IT stocks, while selling was witnessed in Pharma, Media and Realty stocks. The top gainers from the F&O segment were Indian Bank, Amara Raja Batteries and Page Industries. On the other hand, the top losers were Gujarat State Fertilizers & Chemicals, Mahanagar Gas and Reliance Communications. In the index option segment, maximum OI continues to be seen in the 10300-10800 calls and 9900-10400 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 2.52% and reached 13.26. The 50-share Nifty was up by 5.80 points or 0.06% to settle at 10,308.95.

Nifty November 2017 futures closed at 10361.80 on Thursday, at a premium of 52.85 points over spot closing of 10308.95, while Nifty December 2017 futures ended at 10400.70, at a premium of 91.75 points over spot closing. Nifty November futures saw an addition of 0.06 million (mn) units, taking the total outstanding open interest (OI) to 24.72 mn units. The near month derivatives contract will expire on November 30, 2017.

From the most active contracts, Tata Motors November 2017 futures traded at a premium of 2.40 point at 442.75 compared with spot closing of 440.35. The numbers of contracts traded were 67,456.

Axis Bank November 2017 futures traded at a premium of 4.95 points at 543.15 compared with spot closing of 538.20. The numbers of contracts traded were 19,954.

Indiabulls Housing Finance November 2017 futures traded at a premium of 7.45 points at 1239.95 compared with spot closing of 1232.50. The numbers of contracts traded were 17,516.

Reliance Industries November 2017 futures traded at a premium of 3.85 points at 906.75 compared with spot closing of 902.90. The numbers of contracts traded were 16,946.

State Bank of India November 2017 futures traded at a premium of 0.80 points at 315.80 compared with spot closing of 315.00. The numbers of contracts traded were 16,551.

Among Nifty calls, 10400 SP from the November month expiry was the most active call with an addition of 0.08 million open interests. Among Nifty puts, 10300 SP from the November month expiry was the most active put with an addition of 0.12 million open interests.  The maximum OI outstanding for Calls was at 10500 SP (4.52 mn) and that for Puts was at 10200 SP (5.49 mn). The respective Support and Resistance levels of Nifty are: Resistance 10362.62--- Pivot Point 10314.78--- Support --- 10261.12.

The Nifty Put Call Ratio (PCR) finally stood at 1.08 for November month contract. The top five scrips with highest PCR on OI were Repco Home Finance (5.46), Godrej Consumer Products (4.38), JSW Energy (1.87), Cholamandalam Investment and Finance Company (1.84) and Dewan Housing Finance Corporation (1.43).

Among most active underlying, Tata Motors witnessed an addition of 3.94 million units of Open Interest in the November month futures contract, followed by Reliance Industries witnessing  an addition of 0.87 million units of Open Interest in the November month contract, State Bank of India witnessed an addition of 0.32 million units of Open Interest in the November month contract, Axis Bank witnessed an addition of  0.36 million units of Open Interest in the November month contract and Bharti Airtel witnessed  a contraction of 2.02 million units of Open Interest in the November month future contract.