Nifty ends in red for third consecutive day

Key Indian benchmark Nifty ended in red for third consecutive day on Wednesday, with losses of over half a per cent. The index remained in red territory throughout the day, as India’s trade deficit widened to $14.02 billion in October 2017 as against $11.13 billion in October 2016 and export declined by 1.12 per cent to $23 billion during the month under review, retreating from a six-month high growth in September as shipments of textiles, pharmaceuticals, leather and gems and jewellery fell. Weak global cues too dampened sentiments. Investors failed to get any relief from Finance Minister Arun Jaitley’s statement that India is set to become an ‘extremely attractive’ country to do business, with greater digitisation and formalisation of financial activities and businesses. Further, traders also failed to get any comfort with private report stating that the decision to lower GST rates on over 200 items could help pull down retail inflation by 20 basis points from the current levels driven by lower food and beverage prices.

All the sectoral indices ended in red on the NSE. The top gainers from the F&O segment were Indo Count Industries, Fortis Healthcare and Biocon. On the other hand, the top losers were Reliance Communications, Reliance Capital and Reliance Infrastructure. In the index option segment, maximum OI continues to be seen in the 10200-10800 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 increased by 0.71% and reached 14.26. The 50-share Nifty was down by 68.55 points or 0.67% to settle at 10,118.05.

Nifty November 2017 futures closed at 10154.35 on Wednesday, at a premium of 36.30 points over spot closing of 10118.05, while Nifty December 2017 futures ended at 10191.30, at a premium of 73.25 points over spot closing. Nifty November futures saw a contraction of 0.61 million (mn) units, taking the total outstanding open interest (OI) to 24.21 mn units. The near month derivatives contract will expire on November 30, 2017.

From the most active contracts, Reliance Capital November 2017 futures traded at a premium of 1.85 point at 423.85 compared with spot closing of 422.00. The numbers of contracts traded were 34,160.

Bank of Baroda November 2017 futures traded at a premium of 0.20 points at 175.25 compared with spot closing of 175.05. The numbers of contracts traded were 24,946.

Vedanta November 2017 futures traded at a premium of 0.10 points at 296.60 compared with spot closing of 296.50. The numbers of contracts traded were 20,018.

Sun Pharmaceutical Industries November 2017 futures traded at a premium of 2.40 points at 506.95 compared with spot closing of 504.55. The numbers of contracts traded were 19,304.

State Bank of India November 2017 futures traded at a premium of 0.45 points at 326.55 compared with spot closing of 326.10. The numbers of contracts traded were 17,750.

Among Nifty calls, 10300 SP from the November month expiry was the most active call with an addition of 0.45 million open interests. Among Nifty puts, 10100 SP from the November month expiry was the most active put with an addition of 0.23 million open interests.  The maximum OI outstanding for Calls was at 10500 SP (5.82 mn) and that for Puts was at 10200 SP (4.54 mn). The respective Support and Resistance levels of Nifty are: Resistance 10164.33--- Pivot Point 10129.17--- Support --- 10082.88.

The Nifty Put Call Ratio (PCR) finally stood at 0.78 for November month contract. The top five scrips with highest PCR on OI were Godrej Consumer Products (3.74), JSW Energy (2.06), Cholamandalam Investment and Finance Company (1.75), Dewan Housing Finance Corporation (1.32) and Dalmia Bharat (1.30).

Among most active underlying, State Bank of India witnessed a contraction of 1.22 million units of Open Interest in the November month futures contract, followed by Bank of Baroda witnessing  a contraction of 9.54 million units of Open Interest in the November month contract, Tata Global Beverages witnessed a contraction of 1.72 million units of Open Interest in the November month contract, Reliance Industries witnessed a contraction of  0.26 million units of Open Interest in the November month contract and Tata Motors witnessed  an addition of 0.18 million units of Open Interest in the November month future contract.