Nifty closes higher on Thursday

Continuing its record setting spree, Indian equity benchmark Nifty ended higher on Thursday, with the gains of 20 points. The index made an optimistic start and remained firm throughout the session, with IMF’s report that India is projected to clock an economic growth of 7.5% in the 2019-2020 fiscal year, on strengthening of investment and robust private consumption. Domestic sentiments also got boost with Commerce and Industry Minister Suresh Prabhu’s statement that the exports are showing good sign and registering increase at the rate of 20%. Meanwhile, the government will shortly unveil a new industrial policy that aims to speed up regulatory reforms and lower power tariffs to make businesses more competitive and create more jobs.

Further, momentum continued on the street, after a private report stated that optimism level among India’s chief financial officers for the July-September period has improved as compared to the previous quarter and going forward distribution of rainfall, raw material costs and revival in demand will be the key deciding factors. Traders also remained optimistic, after a report stated that India’s average per capita income in the last four financial years was higher at Rs 79,882 as compared to the preceding four fiscals. As per the report, the per capita income grew by 4.6% in 2013-14 to Rs 68,572; 6.2% to Rs 72,805 in 2014-15; 6.9% to Rs 77,826 in 2015-16 and by 5.7% to Rs 82,229 in 2016-17. The market participants paid no heed towards government auditor CAG’s report that National Highways Authority of India (NHAI) suffered losses of about Rs 400 crore on various counts including undue favour to developers by not recovering damages for project delays.

Traders were seen piling up positions in PSU Bank, Realty and Metal, while selling was witnessed in Pharma, Media and Auto. The top gainers from the F&O segment were Hindustan Construction Company, PC Jeweller and Reliance Communications. On the other hand, the top losers were NMDC, Jaiprakash Associates and Engineers India. In the index option segment, maximum OI continues to be seen in the 11,200-11,600 calls and 10,800 -11,200 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 1.10% and reached 12.67. The 50-share Nifty was up by 20.70 points or 0.18% to settle at 11,470.70.

Nifty August 2018 futures closed at 11487.55 on Thursday, at a premium of 16.85 points over spot closing of 11470.70, while Nifty September 2018 futures ended at 11517.75, at a premium of 47.05 points over spot closing. Nifty August futures saw an addition of 0.61 million (mn) units, taking the total outstanding open interest (OI) to 28.17 mn units. The near month derivatives contract will expire on August 30, 2018.

From the most active contracts, ICICI Bank August 2018 futures traded at a discount of 0.05 points at 331.95 compared with spot closing of 332.00. The numbers of contracts traded were 61,663.

State Bank of India August 2018 futures traded at a discount of 0.75 points at 316.90 compared with spot closing of 317.65. The numbers of contracts traded were 32,916.

Axis Bank August 2018 futures traded at a premium of 0.70 points at 622.05 compared with spot closing of 621.35. The numbers of contracts traded were 29,286.

Lupin August 2018 futures traded at a discount of 4.70 points at 821.00 compared with spot closing of 825.70. The numbers of contracts traded were 27,011.

Vedanta August 2018 futures traded at a premium of 1.10 points at 231.65 compared with spot closing of 230.55. The numbers of contracts traded were 20,260. 

Among Nifty calls, 11500 SP from the August month expiry was the most active call with an addition of 0.07 million open interests. Among Nifty puts, 11400 SP from the August month expiry was the most active put with an addition of 0.70 million open interests. The maximum OI outstanding for Calls was at 11,500 SP (3.72mn) and that for Puts was at 11,000 SP (5.22mn). The respective Support and Resistance levels of Nifty are: Resistance 11,492.57 ---- Pivot Point 11,473.33 --- Support --- 11,451.47.

The Nifty Put Call Ratio (PCR) finally stood at 1.59 for August month contract. The top five scrips with highest PCR on OI were Dish TV (1.86), Axis Bank (1.68), Adani Enterprises (1.38), ICICI Bank (1.36) and Godfrey Phillips India (1.33).

Among most active underlying, ICICI Bank witnessed an addition of 3.14 million units of Open Interest in the August month futures contract, followed by Reliance Industries witnessing a contraction of 0.74 million units of Open Interest in the August month contract, State Bank of India witnessed an addition of 2.17 million units of Open Interest in the August month contract, Axis Bank witnessed an addition of 3.13 million units of Open Interest in the August month contract and Maruti Suzuki India witnessed an addition of 0.15 million units of Open Interest in the August month future contract.