Nifty closes at fresh record high with around 1% gain

Continuing its record setting streak, the local equity benchmark Nifty ended the session higher on Friday with gains of around a percent. After a positive start, the index remained bullish throughout the session, aided by Niti Aayog CEO Amitabh Kant’s statement that the government’s digitization initiative will bring more transparency in the system. Domestic sentiments also got boost with a private report stating that after almost a year and half of disruptions in Indian economy due to demonetisation and the Goods and Services Tax (GST), the consumer sentiment is up in the month of July on all fronts from jobs, investments, health of the economy to personal finance. In July, the consumer sentiment surged by 2.3 points over last month, with the maximum rise of 3.6 points witnessed in employment confidence for jobs.

In second half of the session, Nifty gained traction to reach at fresh record high, tracking firm global markets. The market participants took some encouragement with another private report stating that trading across borders, payment of indirect taxes and insolvency resolution are the three sets of reforms where India is upbeat, ahead of the release of the World Bank’s ease of doing business report later this year. Besides, Principal Deputy Assistant Secretary of State for South and Central Asia said that the US wants to reduce its trade deficit with India as quickly as possible, asserting that the Trump administration is aggressively pushing New Delhi on the issues of medical devices, pharmaceuticals, dairy products and agriculture, also buoyed investors’ sentiments.

All the sectoral indices ended in green on the NSE except PSU Bank. The top gainers from the F&O segment were Reliance Capital, Max Financial Services and Castrol India. On the other hand, the top losers were Cholamandalam Investment and Finance Company, Balkrishna Industries and Shree Cement. In the index option segment, maximum OI continues to be seen in the 11,000 -11,600 calls and 10,700 -11,100 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 2.35% and reached 12.31. The 50-share Nifty was up by 111.05 points or 0.99% to settle at 11,278.35.

Nifty August 2018 futures closed at 11306.70 on Friday, at a premium of 28.35 points over spot closing of 11278.35, while Nifty September 2018 futures ended at 11323.75, at a premium of 45.40 points over spot closing. Nifty August futures saw an addition of 1.97 million (mn) units, taking the total outstanding open interest (OI) to 22.79 mn units. The near month derivatives contract will expire on August 30, 2018.

From the most active contracts, ITC August 2018 futures traded at a premium of 1.55 points at 303.15 compared with spot closing of 301.60. The numbers of contracts traded were 38,427.

Biocon August 2018 futures traded at a premium of 3.70 points at 588.50 compared with spot closing of 584.80. The numbers of contracts traded were 28,912.

SBI August 2018 futures traded at a premium of 1.70 points at 288.25 compared with spot closing of 286.55. The numbers of contracts traded were 28,637.

Reliance Industries August 2018 futures traded at a premium of 8.20 points at 1136.20 compared with spot closing of 1128.00. The numbers of contracts traded were 24,903.

ICICI Bank August 2018 futures traded at a premium of 0.55 points at 292.80 compared with spot closing of 292.25. The numbers of contracts traded were 24,106.

Among Nifty calls, 11400 SP from the August month expiry was the most active call with an addition of 0.58 million open interests. Among Nifty puts, 11200 SP from the August month expiry was the most active put with an addition of 1.03 million open interests. The maximum OI outstanding for Calls was at 11,500 SP (2.76mn) and that for Puts was at 11,000 SP (3.84 mn). The respective Support and Resistance levels of Nifty are: Resistance 11,304.42 ---- Pivot Point 11,257.33 --- Support --- 11,231.27.

The Nifty Put Call Ratio (PCR) finally stood at 1.38 for August month contract. The top five scrips with highest PCR on OI were Godfrey Phillips India (2.67), Hindustan Construction Company (1.45), ACC (1.45), Dish TV (1.44) and Oil India (1.43).

Among most active underlying, Reliance Industries India witnessed an addition of 1.78 million units of Open Interest in the August month futures contract, followed by ITC witnessing an addition of 1.21 million units of Open Interest in the August month contract, State Bank of India witnessed an addition of 1.46 million units of Open Interest in the August month contract, ICICI Bank witnessed a contraction of 0.57 million units of Open Interest in the August month contract and  Maruti Suzuki India witnessed an addition of 0.08 million units of Open Interest in the August month future contract.