Nifty ends higher; surpasses 10,850 level

The local equity benchmark Nifty ended higher on Monday, with the gains of 80.25 points. The index made an optimistic start to trade jubilantly throughout the session, aided by industry body Assocham’s statement that the government’s decision to hike the minimum support price (MSP) for 14 khariff crops would boost farmers’ income, resulting in a huge rural demand push to the Indian economy. Domestic sentiments got boost with Economic Affairs Secretary Subhash Chandra Garg’s statement that India's macroeconomic story is quite good. He also noted that the risks to the macro story and stability are far more manageable than ever. Investors took encouragement with a report by the World Trade Organization (WTO) showing that India has initiated far more number of measures widely considered to be trade restricting since last year, when the US and China began locking horns on a global trade war spanning hundreds of billions of dollars. 

Nifty further gained strength in second half of the session, tracking firm global cues along with continuous buying by the market participants. Adding some optimism, Chief Executive Office and Managing Director of BSE Ashishkumar Chauhan said that India will hit double-digit growth rates soon with growing GDP, legislative reforms such as GST and IBC, bolstered trading sentiments. Separately, Agriculture Secretary Shobhana Pattanayak said that India’s foodgrain output could exceed last year’s record of 279.51 million tonne (MT) buoyed by favourable monsoon, higher MSP and likely increase in crop productivity. Meanwhile, Union Finance Minister Piyush Goyal has lauded the Goods and Service Tax council for working as a responsive organisation and successfully implementing GST bill in the country in just a year.

All the sectoral indices ended in green on the NSE. The top gainers from the F&O segment were Hexaware Technologies, Max Financial Services and The Karnataka Bank. On the other hand, the top losers were Bharat Electronics, UltraTech Cement and Tata Consultancy Services.  In the index option segment, maximum OI continues to be seen in the 10,900-11,000 calls and 10,600-10,700 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 0.42% and reached 12.39 The 50-share Nifty was up by 80.25 points or 0.74% to settle at 10,852.90.

Nifty July 2018 futures closed at 10859.85 on Monday, at a premium of 6.95 points over spot closing of 10852.90, while Nifty August 2018 futures ended at 10881.25, at a premium of 28.35 points over spot closing. Nifty July futures saw an addition of 1.02 million (mn) units, taking the total outstanding open interest (OI) to 22.64 mn units. The near month derivatives contract will expire on July 26, 2018.

From the most active contracts, Yes Bank July 2018 futures traded at a premium of 0.75 points at 363.60 compared with spot closing of 362.85. The numbers of contracts traded were 18,860.

Tata Consultancy Services July 2018 futures traded at a premium of 4.60 points at 1888.80 compared with spot closing of 1884.20. The numbers of contracts traded were 17,063.

Reliance Industries July 2018 futures traded at a premium of 1.45 points at 999.25 compared with spot closing of 996.00. The numbers of contracts traded were 16,751.

Tata Steel July 2018 futures traded at a premium of 3.15 points at 558.45 compared with spot closing of 555.30. The numbers of contracts traded were 14,008.

SBI July 2018 futures traded at a premium of 0.85 points at 262.20 compared with spot closing of 261.35. The numbers of contracts traded were 13,387.

Among Nifty calls, 10900 SP from the July month expiry was the most active call an contraction of 0.05 million open interests. Among Nifty puts, 10800 SP from the July month expiry was the most active put with an addition of 0.91 million open interests. The maximum OI outstanding for Calls was at 11,000 SP (3.73 mn) and that for Puts was at 10,600 SP (5.23 mn). The respective Support and Resistance levels of Nifty are: Resistance 10,873.12 ---- Pivot Point 10,840.13 --- Support --- 10,819.92.

The Nifty Put Call Ratio (PCR) finally stood at 1.25 for July month contract. The top five scrips with highest PCR on OI were Oil India (1.48), Maruti Suzuki (1.22), Justdial (1.15), Dish TV (1.13) and Jain Irrigation Systems (1.07).

Among most active underlying, Reliance Industries witnessed a contraction of 0.51 million units of Open Interest in the July month futures contract, followed by Tata Consultancy Services witnessing an addition of 0.87 million units of Open Interest in the July month contract, Yes Bank witnessed an addition  of 0.94 million units of Open Interest in the July month contract, SBI witnessed a contraction of 1.62 million units of Open Interest in the July month contract and ICICI Bank witnessed an addition of 6.74 million units of Open Interest in the July month future contract.