Nifty ends flat on Friday

Local benchmark Nifty ended last trading day of the week on a flat note with a positive bias. After a cautious start, the index altered between red and green terrain. Sentiments remained dampened with Federation of Indian Export Organisations (FIEO) President Ganesh Kumar Gupta’s statement that exporters are facing uncertainty due to a continuous depreciation of the domestic currency as they are not able to negotiate properly prices of goods in the global markets. Market sentiments also got hit after the International Energy Agency (IEA) said crude oil prices are likely to rise further in 2018 and may remain above $75 a barrel for some time, owing to the geo-political situations across the world - including Iran sanctions and drop in Venezuela production.  

However, Nifty erased almost all of its losses in last leg of trade to end flat supported by Union finance minister Arun Jaitley’s statement that the demonetisation of Rs 500 and Rs 1000 notes in November 2016, led to formalisation of economy, increased tax collection and higher growth. Some relief also came with a private report that the economic growth is expected to rise to 7.6% in the April-June quarter of 2018-19 from a sub-6% figure in the year-ago period mainly due to a low-base effect. Traders also took some solace with Niti Aayog Vice-Chairman Rajiv Kumar’s statement that the government is committed to fiscal discipline and added that the Prime Minister resisted the pressure to cut down excise duty on fuel despite rising oil prices.

Traders were seen piling up positions in Pharma, IT and PSU Bank, while selling was witnessed in Media, Metal and PVT Bank. The top gainers from the F&O segment were MindTree, GMR Infrastructure and Dr. Reddy's Laboratories. On the other hand, the top losers were Yes Bank, Tata Communications and Max Financial Services. In the index option segment, maximum OI continues to be seen in the 11,700-12,000 calls and 11,300- 11,700 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 1.49% and reached 12.59. The 50-share Nifty was up by 3.70 points or 0.03% to settle at 11,680.50.

Nifty September 2018 futures closed at 11735.30 on Friday, at a premium of 54.80 points over spot closing of 11680.50, while Nifty October 2018 futures ended at 11774.10, at a premium of 93.60 points over spot closing. Nifty September futures saw an addition of 1.54 million (mn) units, taking the total outstanding open interest (OI) to 25.29 mn units. The near month derivatives contract will expire on September 27, 2018.

From the most active contracts, Yes Bank September 2018 futures traded at a premium of 3.35 points at 346.35 compared with spot closing of 343.00. The numbers of contracts traded were 66,232.

Reliance Industries September 2018 futures traded at a premium of 12.50 points at 1251.45 compared with spot closing of 1238.95. The numbers of contracts traded were 29,998.

Sun Pharma September 2018 futures traded at a premium of 1.95 points at 653.85 compared with spot closing of 651.90. The numbers of contracts traded were 23,346.

Tata Steel September 2018 futures traded at a premium of 4.90 points at 605.30 compared with spot closing of 600.40. The numbers of contracts traded were 19,122.

Lupin September 2018 futures traded at a premium of 6.25 points at 937.75 compared with spot closing of 931.50. The numbers of contracts traded were 18,894. 

Among Nifty calls, 11800 SP from the September month expiry was the most active call with an addition of 0.49 million open interests. Among Nifty puts, 11600 SP from the September month expiry was the most active put with an addition of 0.71 million open interests. The maximum OI outstanding for Calls was at 11,800 SP (2.74mn) and that for Puts was at 11,600 SP (3.24mn). The respective Support and Resistance levels of Nifty are: Resistance 11,725.40 ---- Pivot Point 11,682.75 --- Support --- 11,637.85.

The Nifty Put Call Ratio (PCR) finally stood at 1.18 for September month contract. The top five scrips with highest PCR on OI were AXIS Bank (1.83), Dewan Housing Finance Corporation (1.34), Infibeam Avenues (1.25), Cummins India (1.15) and Jain Irrigation Systems (1.05).

Among most active underlying, Reliance Industries witnessed an addition of 3.63 million units of Open Interest in the September month futures contract, followed by Yes Bank witnessing an addition of 14.43 million units of Open Interest in the September month contract, Sun Pharma witnessed a contraction of 0.94 million units of Open Interest in the September month contract, ICICI Bank witnessed a contraction of 2.59 million units of Open Interest in the September month contract and State Bank of India witnessed an addition of 1.75 million units of Open Interest in the September month future contract.