Nifty snaps record setting spree; settles marginally lower

Snapping the record setting spree, the local equity benchmark Nifty ended marginally lower on last trading day of the week, following lackluster cues from other Asian markets. The index remained sluggish throughout the session amid report that India is among the bottom five countries on the Environmental Performance Index (EPI) 2018, plummeting 36 places from 141 in 2016. Sentiments were downbeat as the country’s gems and jewellery exports contracted by 4.65 per cent to about $25 billion during April-December this fiscal owing to demand slowdown in major markets, including the US. Investors awaited the annual Budget for the fiscal year 2018-2019 to be unveiled on February 1. However, the Nifty managed to erase most of its losses in the last leg of trade, as traders took some support with the private report highlighting that waning effects from the GST impact will help push the Indian GDP growth to 7 per cent in FY19. The report further noted that the growth has slid from previous year’s 7.1% to 6.5% in FY18 due to the implementation of the GST. But as some of the short-run disruptions caused by GST got ironed out, the firm expects growth to rise in the next couple of years. Some support also came with Niti Aayog CEO Amitabh Kant’s statement that some states have improved in terms of ease of doing business after they were ranked very low on an index, as he credited the change to ‘name and shame’. 

Traders were seen piling up positions in Banking, Financial Services and Metal stocks, while selling was witnessed in Realty, Pharma and Media stocks. The top gainers from the F&O segment were NIIT Technologies, Adani Enterprises and Dish TV India. On the other hand, the top losers were Punjab National Bank, UPL and Syndicate Bank. In the index option segment, maximum OI continues to be seen in the 10800-11300 calls and 10400-11000 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 2.95% and reached 17.50. The 50-share Nifty was down by 16.35 points or 0.15% to settle at 11,069.65.

Nifty February 2018 futures closed at 11062.60 on Thursday, at a discount of 7.05 points over spot closing of 11069.65, while Nifty March 2018 futures ended at 11075.15, at a premium of 5.50 points over spot closing. Nifty February futures saw an addition of 10.52 million (mn) units, taking the total outstanding open interest (OI) to 25.05 mn units. The near month derivatives contract will expire on February 22, 2018.

From the most active contracts, Maruti Suzuki India February 2018 futures traded at a premium of 34.25 points at 9334.15 compared with spot closing of 9299.90. The numbers of contracts traded were 29,695.

Indiabulls Housing Finance February 2018 futures traded at a discount of 9.95 points at 1389.40 compared with spot closing of 1399.35. The numbers of contracts traded were 29,412.

State Bank of India February 2018 futures traded at a premium of 2.55 points at 314.45 compared with spot closing of 311.90. The numbers of contracts traded were 26,586.

HDFC Bank February 2018 futures traded at a premium of 2.45 points at 1971.45 compared with spot closing of 1969.00. The numbers of contracts traded were 25,181.

Tata Motors February 2018 futures traded at a premium of 2.95 point at 402.85 compared with spot closing of 399.90. The numbers of contracts traded were 24,016.

Among Nifty calls, 11100 SP from the February month expiry was the most active call with an addition of 0.40 million open interests. Among Nifty puts, 11000 SP from the February month expiry was the most active put with an addition of 0.49 million open interests.  The maximum OI outstanding for Calls was at 10800 SP (2.26 mn) and that for Puts was at 10500 SP (4.82 mn). The respective Support and Resistance levels of Nifty are: Resistance 11107.10 --- Pivot Point 11058.15 --- Support --- 11020.70.

The Nifty Put Call Ratio (PCR) finally stood at 2.51 for February month contract. The top five scrips with highest PCR on OI were the Tech Mahindra (2.16), ICICI Bank (1.81), Chennai Petroleum Corporation (1.76), Torrent Pharmaceuticals (1.68) and Tata Consultancy Services (1.47).

Among most active underlying, State Bank of India witnessed an addition of 21.01 million units of Open Interest in the February month futures contract, followed by Maruti Suzuki India witnessing an addition of 1.15 million units of Open Interest in the February month contract, Reliance Industries witnessed an addition of 12.49 million units of Open Interest in the February month contract, HDFC Bank witnessed an addition of  6.82 million units of Open Interest in the February month contract and ICICI Bank  witnessed  an addition of 28.41 million units of Open Interest in the February month future contract.