Nifty settles in red; closes below 10,150 mark

Indian equity benchmark Nifty ended last trading day of the week near the day’s low, posting losses of over a per cent, amid weak European markets. The index started on a positive note with taking some support from India’s Q2 GDP which has accelerated to 6.3% in the July-September quarter of fiscal year 2017-18 (Q2FY18), from  a three-year low of 5.7% in the April-June quarter,  as  businesses adjusted to the new Goods and Services Tax (GST) regime. Some comfort also came with Finance Minister Arun Jaitley’s statement that the rise in GDP growth rate to 6.3 percent in the July-September period of 2017-18 signals a reversal of downtrend witnessed over the preceding five quarters. Separately, India’s manufacturing sector growth touched a thirteen-month high in November, driven by an accelerated increase in new orders, purchasing activity and output. It indicated a robust improvement in manufacturing business conditions. However, the market failed to hold momentum for a long time and slipped in red to end near intraday low, as traders’ sentiments turned pessimistic after the eight core sectors grew at a slower pace of 4.7% in October, chiefly due to subdued performance of cement, steel and refinery segments. Some concerns also came with report that India’s fiscal deficit, the gap between expenditure and revenue, touched 96.1% of the budget estimate in the first seven months of financial year 2017-18, mainly because of lower revenue collections and increase in expenditure. Besides, Chief Statistician TCA Anant said that the Goods and Services Tax (GST) regime, which kicked in from July 1, has posed fresh a new challenge for calculating India’s Gross Domestic Product (GDP).

All the sectoral indices ended in red on the NSE. The top gainers from the F&O segment were Apollo Hospitals Enterprise, Biocon and Steel Authority of India. On the other hand, the top losers were Syndicate Bank, KPIT Technologies and Tata Power Company. In the index option segment, maximum OI continues to be seen in the 10200-10800 calls and 9800-10500 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 9.19% and reached 14.79. The 50-share Nifty was down by 104.75 points or 1.02% to settle at 10,121.80.

Nifty December 2017 futures closed at 10154.25 on Friday, at a premium of 32.45 points over spot closing of 10121.80, while Nifty January 2018 futures ended at 10188.75, at a premium of 66.95 points over spot closing. Nifty December futures saw an addition of 0.44 million (mn) units, taking the total outstanding open interest (OI) to 17.75 mn units. The near month derivatives contract will expire on December 28, 2017.

From the most active contracts, Tata Motors December 2017 futures traded at a premium of 0.90 point at 399.90 compared with spot closing of 399.00. The numbers of contracts traded were 16,483.

Tata Steel December 2017 futures traded at a premium of 1.10 points at 682.05 compared with spot closing of 680.95. The numbers of contracts traded were 15,760.

Reliance Industries December 2017 futures traded at a premium of 4.50 points at 914.00 compared with spot closing of 909.50. The numbers of contracts traded were 15,002.

Vedanta December 2017 futures traded at a premium of 2.25 points at 288.15 compared with spot closing of 285.90. The numbers of contracts traded were 14,247.
 
State Bank of India December 2017 futures traded at a premium of 1.25 points at 314.15 compared with spot closing of 312.90. The numbers of contracts traded were 14,236.

Among Nifty calls, 10400 SP from the December month expiry was the most active call with an addition of 1.21 million open interests. Among Nifty puts, 10200 SP from the December month expiry was the most active put with an addition of 0.37 million open interests.  The maximum OI outstanding for Calls was at 10500 SP (5.78 mn) and that for Puts was at 10000 SP (7.96 mn). The respective Support and Resistance levels of Nifty are: Resistance 10226.82--- Pivot Point 10167.68--- Support --- 10062.67.

The Nifty Put Call Ratio (PCR) finally stood at 0.89 for December month contract. The top five scrips with highest PCR on OI were Berger Paints India (3.60), Repco Home Finance (2.00), United Breweries (1.41), Hero Motocorp (1.29) and Oriental Bank of Commerce (1.26).

Among most active underlying, Reliance Industries witnessed an addition of 1.24 million units of Open Interest in the December month futures contract, followed by State Bank of India witnessing  an addition of 0.71 million units of Open Interest in the December month contract, Tata Motors witnessed an addition of 0.59 million units of Open Interest in the December month contract, Tata Steel  witnessed an addition of  0.79 million units of Open Interest in the December month contract and Maruti Suzuki India witnessed  an addition of 0.07 million units of Open Interest in the December month future contract.