Nifty ends slightly higher for third straight session

Indian equity benchmark Nifty ended slightly higher for third straight session on Monday, closing just shy of its psychological level 10,300. The market witnessed volatility during the day as Moody’s Investors Service noted that India’s budget deficit would widen in 2017-18, due to lower taxes and higher public expenditure. Besides, sluggish global cues and report of further rise in retail inflation, also weighed on the sentiments. The index altered between green and red terrain but managed to end the session above neutral line with taking support from the report that India has climbed up one position to 126th in the International Monetary Fund's (IMF) ranking of countries based on their Gross Domestic Product (GDP) per capita. India's GDP per capita went up to $7,170 (Rs 4.66 lakh) in 2017 from $6,690 last year, helping improve its rank by a position to 126th. Some relief also came with SBI Research’s latest report that India would need not wait for 13 long years for the next sovereign upgrade by a rating agency, with government’s resolve on fiscal consolidation target along with recent reform measures like Goods and Services Tax (GST) and Bankruptcy and Insolvency code. Investors also took some comfort from Finance Secretary Hasmukh Adhia’s statement that the latest changes have resolved nearly 90% of problems and discontentment related to the indirect tax regime.

Traders were seen piling up positions in Realty, Metal and FMCG stocks, while selling was witnessed in IT, Media and Pharma stocks. The top gainers from the F&O segment were Indiabulls Real Estate, Biocon and Idea Cellular. On the other hand, the top losers were Shree Cements, Ambuja Cements and the Ramco Cements. In the index option segment, maximum OI continues to be seen in the 10200-10800 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 2.04% and reached 13.43. The 50-share Nifty was up by 15.15 points or 0.15% to settle at 10,298.75.

Nifty November 2017 futures closed at 10320.05 on Monday, at a premium of 21.30 points over spot closing of 10298.75, while Nifty December 2017 futures ended at 10355.20, at a premium of 56.45 points over spot closing. Nifty November futures saw an addition of 0.06 million (mn) units, taking the total outstanding open interest (OI) to 23.12 mn units. The near month derivatives contract will expire on November 30, 2017.

From the most active contracts, Infosys November 2017 futures traded at a premium of 1.90 point at 962.85 compared with spot closing of 960.95. The numbers of contracts traded were 13,978.

Tata Global Beverages November 2017 futures traded at a premium of 0.05 points at 275.20 compared with spot closing of 275.15. The numbers of contracts traded were 13,329.

Tata Steel November 2017 futures traded at a premium of 1.90 points at 703.50 compared with spot closing of 701.60. The numbers of contracts traded were 12,927.

Vedanta November 2017 futures traded at a discount of 0.40 points at 314.55 compared with spot closing of 314.95. The numbers of contracts traded were 12,821.

State Bank of India November 2017 futures traded at a premium of 1.50 points at 334.25 compared with spot closing of 332.75. The numbers of contracts traded were 12,155.

Among Nifty calls, 10400 SP from the November month expiry was the most active call with an addition of 0.22 million open interests. Among Nifty puts, 10300 SP from the November month expiry was the most active put with an addition of 0.24 million open interests.  The maximum OI outstanding for Calls was at 10500 SP (6.40 mn) and that for Puts was at 10200 SP (5.29 mn). The respective Support and Resistance levels of Nifty are: Resistance 10318.57--- Pivot Point 10290.03--- Support --- 10270.22.

The Nifty Put Call Ratio (PCR) finally stood at 0.91 for November month contract. The top five scrips with highest PCR on OI were Godrej Consumer Products (3.69), JSW Energy (2.20), DLF (1.39), Dewan Housing Finance Corporation (1.36), and Infibeam Incorporation (1.23).

Among most active underlying, Tata Global Beverages witnessed a contraction of 1.19 million units of Open Interest in the November month futures contract, followed by Reliance Industries witnessing  a contraction of 0.80 million units of Open Interest in the November month contract, State Bank of India witnessed an addition of 0.24 million units of Open Interest in the November month contract, Tata Steel witnessed a contraction of  0.16 million units of Open Interest in the November month contract and Maruti Suzuki India witnessed  a contraction of 0.01 million units of Open Interest in the November month future contract.