Nifty extends northward journey for third straight session

Continuing its rally for third straight session, Indian equity benchmark -- Nifty -- ended in green above its crucial psychological level of 10,350 on Monday, amid firm global cues. The index made a positive start and continued to trade firmly throughout the session, backed by the United Nations’ (UN) latest report ‘the World Economic Situation and Prospects 2018’ stating that Indian economy is likely to accelerate from 6.7% in 2017 to 7.2% in 2018 and 7.4% in 2019. The report also indicated that the country’s outlook remains largely positive with robust private consumption, public investment and ongoing structural reforms. The domestic sentiments remained optimistic with Finance Minister Arun Jaitley’s statement that the Indian economy, which saw temporary disruptions caused by demonetisation and the roll-out of the goods and services tax (GST) over the past two years, will see consolidation in the current fiscal. Jaitley also said reforms such as GST, Insolvency and Bankruptcy Code and new income tax regulations are contributing to a better investment climate. Investors’ sentiments also got some encouragement amid optimism ahead of the earnings season, which will begin later this week with Infosys’ January-March results on Friday. Some support also came with the Reserve Bank of India’s latest report stating that the country's foreign exchange reserves hit a life-time high of $424.361 billion after rising by $1.828 billion in the week to March 30, helped by rise in foreign currency assets. Market participants took note of Economic Affairs Secretary Subhash Chandra Garg’s statement that India will need to create and develop a very healthy and supportive macro-economic environment to become $10 trillion economy by the year 2030. He also said that the present government has taken number of bold steps like Goods and services Tax (GST) and IBC (Insolvency and Bankruptcy Code).

Traders were seen piling up positions in FMCG, PVT Bank and PSU Bank stocks, while selling was witnessed in IT, Media and Pharma. The top gainers from the F&O segment were Balkrishna Industries, PVR and Raymond. On the other hand, the top losers were Just Dial, Mahanagar Gas and Dalmia Bharat.

The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility increased by 0.32% and reached 14.79. The 50-share Nifty was up by 47.75 points or 0.46% to settle at 10,379.35.

Nifty April 2018 futures closed at 10393.90 on Monday, at a premium of 14.55 points over spot closing of 10379.35, while Nifty May 2018 futures ended at 10424.80, at a premium of 45.45 points over spot closing. Nifty April futures saw an addition of 0.40 million (mn) units, taking the total outstanding open interest (OI) to 22.39 mn units. The near month derivatives contract will expire on April 26, 2018.

From the most active contracts, ICICI Bank April 2018 futures traded at a discount of 0.05 points at 280.95 compared with spot closing of 281.00. The numbers of contracts traded were 25,424.

State Bank of India April 2018 futures traded at a premium of 1.15 points at 261.00 compared with spot closing of 259.85. The numbers of contracts traded were 19,801.

Tata Steel April 2018 futures traded at a premium of 2.15 points at 587.15 compared with spot closing of 585.00. The numbers of contracts traded were 19,364.

Punjab National Bank April 2018 futures traded at a premium of 0.40 points at 105.50 compared with spot closing of 105.10. The numbers of contracts traded were 18,792.

Tata Motors April 2018 futures traded at a premium of 0.40 points at 358.65 compared with spot closing of 358.25. The numbers of contracts traded were 16,760.

Among Nifty calls, 10500 SP from the April month expiry was the most active call with an addition of 0.23 million open interests. Among Nifty puts, 10300 SP from the April month expiry was the most active put with an addition of 0.37 million open interests. The respective Support and Resistance levels of Nifty are: Resistance 10,408.53 ---- Pivot Point 10,368.52 --- Support --- 10339.33.

The Nifty Put Call Ratio (PCR) finally stood at 1.12 for April month contract. The top five scrips with highest PCR on OI were Hero MotoCorp (1.33), ICICI Bank (1.29), Oil India (1.13), Kotak Bank (1.40) and Bank Baroda (0.93).

Among most active underlying, ICICI Bank witnessed a contraction of 31,18,500 million units of Open Interest in the April month futures contract, followed by State Bank of India witnessing a contraction of 21,54,000 million units of Open Interest in the April month contract, Titan witnessed a contraction of 1,54,500 million units of Open Interest in the April month contract, Tata Steel witnessed a contraction of 0.08 million units of Open Interest in the April month contract and Maruti Suzuki India witnessed an addition of 0.05 million units of Open Interest in the April month future contract.