Nifty ends higher as BJP set to win elections in Himachal, Gujarat

The local equity benchmark Nifty ended higher on Monday, with the gains of more than half a percent, amid firm global cues. The index opened in red but immediately reversed its losses after the vote counts indicated the BJP is set to win key polls in Himachal Pradesh and Gujarat. Investors took some encouragement with Reserve Bank of India (RBI) Governor Urjit Patel’s statement that with growth picking up in the second quarter of the current financial year, the economic slowdown may have bottomed out. Sentiments also remained firm with the report stating that India’s merchandise exports jumped by 30.55% to $26195.76 million in November 2017, on the back of robust growth in shipments of gems and jewellery and engineering goods. Some support also came with UN expert’s statement that India can achieve an eight percent growth rate for the next two decades by promoting investment and improving the living conditions of its people. Adding some gains, Finance Minister Arun Jaitley said that the government has decided to recapitalise public sector banks (PSBs) to enhance credit growth and job creation. Meanwhile, the government sought Parliament’s approval for additional expenditure of Rs 66,113 crore, including funds to rollout schemes to provide electricity connections to poor and payment of urea subsidies.

All the sectoral indices ended in green on the NSE except Realty. The top gainers from the F&O segment were Page Industries, Jindal Steel & Power and Raymond. On the other hand, the top losers were Jain Irrigation Systems, Jaiprakash Associates and Mangalore Refinery & Petrochemicals. In the index option segment, maximum OI continues to be seen in the 10400-11000 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 12.22% and reached 13.11. The 50-share Nifty was up by 55.50 points or 0.54% to settle at 10,388.75.

Nifty December 2017 futures closed at 10404.35 on Monday, at a premium of 15.60 points over spot closing of 10388.75, while Nifty January 2018 futures ended at 10439.30, at a premium of 50.55 points over spot closing. Nifty December futures saw a contraction of 0.27 million (mn) units, taking the total outstanding open interest (OI) to 19.46 mn units. The near month derivatives contract will expire on December 28, 2017.

From the most active contracts, State Bank of India December 2017 futures traded at a premium of 1.00 point at 319.70 compared with spot closing of 318.70. The numbers of contracts traded were 29,296.

Vedanta December 2017 futures traded at a premium of 0.40 points at 309.85 compared with spot closing of 309.45. The numbers of contracts traded were 26,971.

Reliance Industries December 2017 futures traded at a premium of 0.50 points at 922.95 compared with spot closing of 922.45. The numbers of contracts traded were 21,402.

HDFC Bank December 2017 futures traded at a discount of 0.80 points at 1877.60 compared with spot closing of 1878.40. The numbers of contracts traded were 20,796.
 
Adani Enterprises December 2017 futures traded at a premium of 0.35 points at 160.05 compared with spot closing of 159.70. The numbers of contracts traded were 20,623.

Among Nifty calls, 10500 SP from the December month expiry was the most active call with a contraction of 0.11 million open interests. Among Nifty puts, 10300 SP from the December month expiry was the most active put with an addition of 0.59 million open interests.  The maximum OI outstanding for Calls was at 10500 SP (7.24 mn) and that for Puts was at 10000 SP (8.14 mn). The respective Support and Resistance levels of Nifty are: Resistance 10529.93--- Pivot Point 10302.37--- Support --- 10161.18.

The Nifty Put Call Ratio (PCR) finally stood at 1.02 for December month contract. The top five scrips with highest PCR on OI were Godrej Consumer Products (2.11), Marico (1.56), JSW Energy (1.35), Sun TV Network (1.34) and Maruti Suzuki India (1.32).
Among most active underlying, State Bank of India witnessed a contraction of 0.13 million units of Open Interest in the December month futures contract, followed by Reliance Industries witnessing  a contraction of 0.75 million units of Open Interest in the December month contract, Maruti Suzuki India witnessed a contraction of 0.006 million units of Open Interest in the December month contract, Tata Steel  witnessed an addition of  0.006 million units of Open Interest in the December month contract and HDFC Bank witnessed  a contraction of 0.02 million units of Open Interest in the December month future contract.