Nifty ends near day’s low

An Indian equity benchmark Nifty ended in red terrain on last trading day of the week, with losses of more than half a per cent. After a cautious start, the index continued to trade sluggish throughout the session, as anxiety spread among the traders with the credit ratings agency, ICRA’s latest report that the high quantum of non-performing asset (NPA) will restrict the overall bank credit growth to a moderate 7-8% in fiscal 2018-19, despite recapitalisation of public sector banks (PSBs) and private sector players upping their game with a 25 percent credit growth. It also said that India Inc will borrow more from cheaper sources abroad. Besides, the markets participants got cautious with a report stating that bank deposit growth falls to a five-decade low to 6.7 percent in the fiscal year ended March 2018. Bankers say the reversal from the huge deposits post demonetisation and the steady movement of savings away from bank deposits has hit growth. A positive Service PMI data failed to provide any relief to the investors. Activity in India’s services sector grew at the fastest pace in month of April, on the back of greater inflows of new work. According to the survey report, the seasonally adjusted Nikkei Services Business Activity Index remained above the neutral mark of 50.0 in April, posting reading at 51.4, up from 50.3 in March. The Nikkei India Composite PMI Output Index which measures both manufacturing and services too climbed to 51.9 in April from 50.8 in March. The traders also overlooked a private report stating that India tops the list of the fastest growing economies in the world for the coming decade and is projected to grow at 7.9 per cent annually, ahead of China and the US. It said that India’s productive capabilities far exceed expectations for its current income level, which contributes to the projection of rapid growth for the coming decade.

All the sectoral indices ended in red on the NSE, except Bank and PVT Bank. The top gainers from the F&O segment were PC Jeweller, Just Dial and Hindustan Construction Company. On the other hand, the top losers were Hexaware Technologies, Castrol India and Ajanta Pharma. In the index option segment, maximum OI continues to be seen in the 10,800-11,000 calls and 10,300-10,500 puts indicating this is the trading range expectation.

The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility increased by 2.04% and reached 13.25. The 50-share Nifty was down by 61.40 points or 0.57% to settle at 10,618.25.

Nifty May 2018 futures closed at 10658.75 on Friday, at a premium of 40.50 points over spot closing of 10618.25, while Nifty June 2018 futures ended at 10669.50, at a premium of 51.25 points over spot closing. Nifty May futures saw a contraction of 0.11 million (mn) units, taking the total outstanding open interest (OI) to 23.61 mn units. The near month derivatives contract will expire on May 31, 2018.

From the most active contracts, NIIT Technologies May 2018 futures traded at a premium of 5.50 points at 1036.20 compared with spot closing of 1030.70. The numbers of contracts traded were 34,889.

PC Jeweller May 2018 futures traded at a discount of 1.10 points at 174.90 compared with spot closing of 176.00. The numbers of contracts traded were 23,697.

Hexaware Technologies May 2018 futures traded at a discount of 13.15 points at 377.65 compared with spot closing of 390.80. The numbers of contracts traded were 20,137.

Vedanta May 2018 futures traded at a premium of 3.55 points at 283.05 compared with spot closing of 279.50. The numbers of contracts traded were 17,689.

Yes Bank May 2018 futures traded at a premium of 1.80 points at 347.45 compared with spot closing of 345.65. The numbers of contracts traded were 13,802.

Among Nifty calls, 10700 SP from the May month expiry was the most active call with an addition of 0.36 million open interests. Among Nifty puts, 10600 SP from the May month expiry was the most active put with a contraction of 0.03 million open interests. The maximum OI outstanding for Calls was at 11000 SP (5.79mn) and that for Puts was at 10500 SP (4.80mn). The respective Support and Resistance levels of Nifty are: Resistance 10,678.60 ---- Pivot Point 10,640.10 --- Support --- 10579.75.

The Nifty Put Call Ratio (PCR) finally stood at 1.17 for May month contract. The top five scrips with highest PCR on OI were Dish TV (1.75), Infibeam Incorporation (1.53), Godrej Consumer Products (1.19), AXIS Bank (1.16) and ICICI Bank (1.00).

Among most active underlying, NIIT Technologies witnessed an addition of 0.86 million units of Open Interest in the May month futures contract, followed by Hexaware Technologies witnessing an addition of 2.28 million units of Open Interest in the May month contract, Reliance Industries witnessed a contraction of 0.06 million units of Open Interest in the May month contract, Yes Bank witnessed an addition of 0.91 million units of Open Interest in the May month contract and Vedanta witnessed an addition of 1.93 million units of Open Interest in the May month future contract.