Nifty logs gains for third consecutive session

Continuing its gaining streak for third consecutive session, the local equity benchmark Nifty ended higher on Monday, with the gains of around 0.80%.  The index traded with jubilation throughout the session, aided by Confederation of Indian Industry’s (CII) statement that the Indian economy is on a recovery path and investments will pick up. It also expects the country to record growth of 7.3-7.7% in 2018-19. Domestic sentiments also remained upbeat with Finance Minister Arun Jaitley’s statement that India has transformed from being a part of the ‘fragile five’ to the ‘bright spot’ on the global economic stage. He added that the government will now focus on consolidation of the initiatives taken in the past. Some support also came with the United Nations Economic Affairs Officer, Sebastian Vergara’s statement that India is in a good position to deal with any fallout from global trade tensions and with right policies can reach an 8% plus growth rate and hold it. Further, the market participants also took some encouragement with Care Ratings’ report stating the country’s industrial output is expected to log five to six per cent growth in this fiscal, bettering 4.3 per cent growth rate clocked in the previous fiscal. The street also took some support from Union Minister Suresh Prabhu’s statement that the commerce and industry ministry will work on several areas, including formulation of a comprehensive action plan to boost exports and give special thrust on industrial corridors in the last one year of the NDA government. 

All the sectoral indices ended in green on the NSE except IT. The top gainers from the F&O segment were Just Dial, Can Fin Homes and Oriental Bank of Commerce. On the other hand, the top losers were PC Jeweller, NIIT Technologies and Divi's Laboratories. 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 3.24% and reached 13.05. The 50-share Nifty was up by 83.50 points or 0.79% to settle at 10,688.65.

Nifty May 2018 futures closed at 10678.85 on Monday, at a discount of 9.80 points over spot closing of 10688.65, while Nifty June 2018 futures ended at 10691.20, at a premium of 2.55 points over spot closing.  Nifty May futures saw a contraction of 1.28 million (mn) units, taking the total outstanding open interest (OI) to 20.86 mn units. The near month derivatives contract will expire on May 31, 2018.

From the most active contracts, Sun Pharmaceutical May 2018 futures traded at a premium of 2.15 points at 499.15 compared with spot closing of 497.00. The numbers of contracts traded were 41,018.

State Bank of India May 2018 futures traded at a discount of 0.15 points at 271.80 compared with spot closing of 271.95. The numbers of contracts traded were 21,335.

Indiabulls Housing Finance May 2018 futures traded at a discount of 4.15 points at 1213.20 compared with spot closing of 1217.35. The numbers of contracts traded were 20,559.

Infosys May 2018 futures traded at a premium of 1.75 points at 1213.85 compared with spot closing of 1212.10. The numbers of contracts traded were 18,219.

Maruti Suzuki May 2018 futures traded at a premium of 9.45 points at 8719.45 compared with spot closing of 8710.00. The numbers of contracts traded were 17,794.

Among Nifty calls, 10700 SP from the May month expiry was the most active call with a contraction of 0.05 million open interests. Among Nifty puts, 10600 SP from the May month expiry was the most active put with an addition of 0.96 million open interests. The maximum OI outstanding for Calls was at 10800 SP (5.03mn) and that for Puts was at 10500 SP (6.18mn). The respective Support and Resistance levels of Nifty are: Resistance 10,718.78 ---- Pivot Point 10,679.67 --- Support --- 10649.53.

The Nifty Put Call Ratio (PCR) finally stood at 1.28 for May month contract. The top five scrips with highest PCR on OI were Just Dial (2.12), State Bank of India (1.66), Dish TV (1.49), KPIT (1.48) and Asian Paint (1.41).

Among most active underlying, State Bank of India witnessed a contraction of 10.46 million units of Open Interest in the May month futures contract, followed by Sun Pharmaceutical witnessing a contraction of 9.09 million units of Open Interest in the May month contract, Maruti Suzuki witnessed a contraction of 0.39 million units of Open Interest in the May month contract, Tata Consultancy Services witnessed a contraction of 1.08 million units of Open Interest in the May month contract and Reliance Industries witnessed a contraction of 2.19 million units of Open Interest in the May month future contract.