Nifty ends higher on value buying

Key Indian benchmark -- Nifty -- ended the Tuesday’s trade in green terrain as traders opted to buy beaten-down but fundamentally strong stocks after four days of continuous drubbing. Despite making a negative start, market gained momentum and entered into green terrain as traders turned optimistic with Reserve Bank of India’s (RBI) release stating that the country’s manufacturing sector witnessed an improvement in sales growth in the third quarter this fiscal on annual basis, though net profit has remained subdued due to lack of support from other income. The sales of manufacturing companies increased by 14% in the October-December quarter of 2017-18 compared to similar period of the previous fiscal while net profit declined by 2.4% in the third quarter. Traders also took some support with Former Reserve Bank of India (RBI) Governor Raghuram Rajan’s statement that India can achieve a growth rate of 10%. He added that some key reforms are needed to accelerate India's Growth Rate. However, markets pared some of their early gains to end with marginal gains with traders getting anxious with Bibek Debroy’s statement that India’s net exports are not doing well even as the global economy is on the recovery path. Market participants also remained on sidelines looking forward to the latest developments in the parliament following the no-confidence motion moved by Telugu Desam Party (TDP) after it broke away from the BJP-led NDA following the Centre’s refusal to grant Special Category status to Andhra Pradesh.

Most of the sectoral indices ended in green on the NSE. The top gainers from the F&O segment were Reliance Infra, Jindal Steel and Marico. On the other hand, the top losers were Canara Bank, NBCC and Oil India. In the index option segment, maximum OI continues to be seen in the 10,200-10,600 calls and 9,800-10,200 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 0.21% and reached 15.61. The 50-share Nifty was up by 30.10 points or 0.30% to settle at 10,124.35.

Nifty March 2018 futures closed at 10,143.20 on Tuesday, at a premium of 18.85 points over spot closing of 10,124.35, while Nifty April 2018 futures ended at 10180.15, at a premium of 36.95 points over spot closing. Nifty March futures saw an addition of 0.08 million (mn) units, taking the total outstanding open interest (OI) to 23.11 mn units. The near month derivatives contract will expire on March 28, 2018.

From the most active contracts, Tata Steel March 2018 futures traded at a premium of 1.55 points at 595.90 compared with spot closing of 594.35. The numbers of contracts traded were 32,461.

Jindal Steel March 2018 futures traded at a premium of 1.05 points at 234.55 compared with spot closing of 233.50. The numbers of contracts traded were 17,382.

State Bank of India March 2018 futures traded at a contraction of 0.20 points at 249.80 compared with spot closing of 250.00. The numbers of contracts traded were 16,880.

Canara bank March 2018 futures traded at a contraction of 1.60 points at 255.40 compared with spot closing of 257.00. The numbers of contracts traded were 16,753.

Cipla March 2018 futures traded at a contraction of 0.55 points at 554.70 compared with spot closing of 555.25. The numbers of contracts traded were 14,941.

Among Nifty calls, 10100 SP from the March month expiry was the most active call with an addition of 0.68 million open interests. Among Nifty puts, 10100 SP from the March month expiry was the most active put with an addition of 0.67 million open interests. The maximum OI outstanding for Calls was at 10500 SP (6.47mn) and that for Puts was at 10000 SP (6.82mn). The respective Support and Resistance levels of Nifty are: Resistance 10170.30 -- Pivot Point 10109.70 -- Support -- 10063.75.

The Nifty Put Call Ratio (PCR) finally stood at 0.80 for March month contract. The top five scrips with highest PCR on OI were Andhra Bank (1.16), Allahabad Bank (1.11), Axis Bank (1.05), IndusInd Bank (1.03) and Canara Bank (0.96).

Among most active underlying, Tata Steel witnessed a contraction of 3.14 million units of Open Interest in the March month futures contract, followed by Reliance Industries witnessing an addition of 0.42 million units of Open Interest in the March month contract, Jindal Steel witnessed an addition of 1.35 million units of Open Interest in the March month contract, State Bank of India witnessed a contraction of 1.58 million units of Open Interest in the March month contract and Tata Consultancy Services witnessed a contraction of 0.35 million units of Open Interest in the March month future contract.