Nifty settles near day’s high as RBI maintains status quo

Indian equity benchmark -- Nifty -- settled near intraday high point on Thursday, with the gains of around 2 percent, as the Reserve Bank of India’s (RBI) six-member monetary policy committee (MPC) kept the key repo rate unchanged at 6%. After a positive start, the index continued its rally throughout the day, backed by positive services PMI data. The seasonally adjusted Nikkei Services Business Activity Index managed to narrowly push back above the 50-mark that separates growth from contraction, rising to 50.3 last month from 47.8, while the Nikkei India Composite PMI Output Index which measures both manufacturing and services too climbed to 50.8 in March from 49.7 in February, driven by growth in both the manufacturing and service sectors. Traders’ sentiments remained optimistic as the India Ratings and Research (Ind-Ra) upgraded its India’s economic growth forecast to 7.4% for FY19 from 7.1% forecasted earlier. Some support also came with a report stating that the trade deficit between India and the US dropped by almost six per cent in 2017 compared to the previous year, even as it continued to harp on issues such as market access and high tariffs on several American products being imported into India. Besides, NITI Aayog CEO Amitabh Kant’s statement that the government has been able to save Rs 83,000 crore through direct benefit transfer (DBT) scheme, too added some optimism on the street. Some comfort also came with Minister of State for Steel Vishnu Deo Sai’s stattement that India’s ambition to become a top steel exporter will not be disrupted by the US president’s recent move to impose 25% tariff on steel imports, as it depends on a number of factors which includes demand in the foreign markets, its competitiveness and domestic demand. 

All the sectoral indices ended in green on the NSE. The top gainers from the F&O segment were Adani Enterprises, Canara Bank and Bank of India. On the other hand, the top losers were Strides Shasun, Balrampur Chini Mills and Cipla.

The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility decreased by 9.44% and reached 14.79. The 50-share Nifty was up by 196.75 points or 1.94% to settle at 10,325.15.

Nifty April 2018 futures closed at 10352.20 on Thursday, at a premium of 27.05 points over spot closing of 10325.15, while Nifty May 2018 futures ended at 10380.95, at a premium of 55.80 points over spot closing. Nifty April futures saw a contraction of 0.65 million (mn) units, taking the total outstanding open interest (OI) to 21.39 mn units. The near month derivatives contract will expire on April 26, 2018.

From the most active contracts, Tata Motors April 2018 futures traded at a premium of 2.50 points at 364.50 compared with spot closing of 362.00. The numbers of contracts traded were 30,967.

State Bank of India April 2018 futures traded at a discount of 1.15 points at 259.65 compared with spot closing of 260.80. The numbers of contracts traded were 24,079.

ICICI Bank April 2018 futures traded at a premium of 0.75 points at 279.15 compared with spot closing of 278.40. The numbers of contracts traded were 22,503.

Tata Steel April 2018 futures traded at a premium of 3.45 points at 583.45 compared with spot closing of 580.00. The numbers of contracts traded were 20,673.

Vedanta April 2018 futures traded at a premium of 1.70 points at 291.25 compared with spot closing of 289.55. The numbers of contracts traded were 18,229.

Among Nifty calls, 10400 SP from the April month expiry was the most active call with a contraction of 0.26 million open interests. Among Nifty puts, 10200 SP from the April month expiry was the most active put with an addition of 1.46 million open interests. The respective Support and Resistance levels of Nifty are: Resistance 10,362.15 ---- Pivot Point 10,294.80 --- Support --- 10257.80.

The Nifty Put Call Ratio (PCR) finally stood at 1.11 for April month contract. The top five scrips with highest PCR on OI were Cummins India (1.52), Oil India (1.43), Bajaj Finance (1.32), ICICI Bank (1.31) and Hero MotoCorp (1.15).

Among most active underlying, State Bank of India witnessed a contraction of 5,31,000 million units of Open Interest in the April month futures contract, followed by Tata Motors witnessing a contraction of 2,88,000 million units of Open Interest in the April month contract, ICICI Bank witnessed a contraction of 51,12,250 million units of Open Interest in the April month contract, Tata Steel witnessed a contraction of 3,01,324 million units of Open Interest in the April month contract and Jindal Steel & Power witnessed an addition of 10,62,000 million units of Open Interest in the April month future contract.