Nifty reclaims 11,000 mark on Tuesday

The local equity benchmark Nifty ended on a positive note and reclaimed its 11,000 mark on Tuesday. Strengthening of rupee against the dollar, as crude prices dropped by over 4 per cent in the global market yesterday, boosted the domestic sentiments. The market started on a cautious note, on a report stating that the International Monetary Fund (IMF) trimmed India’s growth projection by 0.1 percentage point to 7.3% for 2018-19 against the earlier estimate of 7.4%, owing to high oil prices and a tight monetary policy regime. But, the market gained some momentum in late morning session with a report stating that corporate India announced deals worth $74.8 billion in the January-June period, registering a 90% jump over last year, largely driven by big ticket consolidations. Investors took note of report which said that the Indian government on July 16 invited Omani companies to invest in India and benefit from Make in India programme aimed to encourage manufacturing. 

Market extended gains in the last leg of trade, as traders took some encouragement with some better-than-expected Q1FY19 numbers posted by bluechip companies. Some optimism also came with private report projecting the Indian economy to record 7.4% growth in 2018-19. Sentiments remained positive with a report that the finance ministry is likely to infuse about Rs 10,000 crore within a few days in some state-owned lenders including PNB, Corporation Bank and Central Bank of India. Meanwhile, Niti Aayog CEO Amitabh Kant said that for India to grow at 9-10% for three decades consistently and reap the dividend of demographic advantage, promoting entrepreneurship among women has to be the key strategy.

All the sectoral indices ended in green except FMCG on the NSE. The top gainers from the F&O segment were Federal Bank, Mangalore Refinery and Petrochemicals and Reliance Communications. On the other hand, the top losers were PC Jeweller, Hindustan Unilever and Balrampur Chini Mills. In the index option segment, maximum OI continues to be seen in the 10,800-11,100 calls and 10,400-10,800 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 0.52% and reached 12.88. The 50-share Nifty was down by 71.20 points or 0.65% to settle at 11,008.05.

Nifty July 2018 futures closed at 11023.75 on Tuesday, at a premium of 15.70 points over spot closing of 11008.05, while Nifty August 2018 futures ended at 11039.55, at a premium of 31.50 points over spot closing. Nifty July futures saw an addition of 0.58 million (mn) units, taking the total outstanding open interest (OI) to 25.04 mn units. The near month derivatives contract will expire on July 26, 2018.

From the most active contracts, Federal Bank July 2018 futures traded flat at 88.45 compared with spot closing of 88.45. The numbers of contracts traded were 33,516.

Hindustan Unilever July 2018 futures traded at a premium of 0.15 points at 1688.15 compared with spot closing of 1688.00. The numbers of contracts traded were 26,048.

Ashok Leyland July 2018 futures traded at a premium 0.40 points at 129.10 compared with spot closing of 128.70. The numbers of contracts traded were 25,662.

Tata Steel July 2018 futures traded at a premium of 2.80 points at 534.05 compared with spot closing of 531.25. The numbers of contracts traded were 21,466.

PC Jeweller July 2018 futures traded at a premium of 1.30 points at 83.35 compared with spot closing of 82.05. The numbers of contracts traded were 19,855.

Among Nifty calls, 11000 SP from the July month expiry was the most active call an addition of 0.42 million open interests. Among Nifty puts, 10900 SP from the July month expiry was the most active put with a contraction of 0.57 million open interests. The maximum OI outstanding for Calls was at 11,000 SP (3.53 mn) and that for Puts was at 10,800 SP (4.66 mn). The respective Support and Resistance levels of Nifty are: Resistance 11,042.50 ---- Pivot Point 10,984.05 --- Support --- 10,949.60.

The Nifty Put Call Ratio (PCR) finally stood at 1.48 for July month contract. The top five scrips with highest PCR on OI were Adani Power (1.40), Adani Enterprises (1.32), Just Dail (1.11), Reliance Industries (1.06) and Andhra Bank (1.02).

Among most active underlying, Hindustan Unilever witnessed an addition of 0.41 million units of Open Interest in the July month futures contract, followed by Reliance Industries witnessing a contraction of 1.14 million units of Open Interest in the July month contract, Infosys witnessed a contraction of 1.09 million units of Open Interest in the July month contract, Tata Consultancy Services India witnessed a contraction of 0.89 million units of Open Interest in the July month contract and State Bank of India   witnessed a contraction of 1.18 million units of Open Interest in the July month future contract.