Nifty ends near day’s low point

The local equity benchmark Nifty ended Wednesday’s session near its intraday low point, with the losses of 150 points. The index made a weak start and remained under the grip of bears throughout the session, amid the government data report stating that the growth of eight core sectors slowed to 4.2% in August, due to fall in output of crude oil, petroleum product and fertiliser. Traders got cautious, as retail inflation for industrial workers rose to 5.61% in August from 2.52% in the year-ago month mainly due to rise in prices of food items and petroleum products. Domestic sentiments also got hit with ICRA’s latest report stating that credit quality pressure on investment grade entities has risen in the six months of April-September 2018, with an increase in the downward rating pressure on them.

Adding some worries, provisional estimate of the first phase of the 10th agricultural census showed that the average size of the Indian farmland shrank by over 6% between 2010-11 and 2015-16, with operational holding in the country dropping to 1.08 hectares from 1.15 hectares in 2010-11. The street overlooked a report that the finance ministry expects the GST collections to cross Rs 1 lakh crore in November and December on account of festive season demand and the anti-evasion measures initiated by the revenue department. The market participants also paid no heed towards a private report stating that private equity (PE) players’ investments in Indian companies in the quarter ended September 2018 increased 60% over the same quarter last year to stand at $9.2 billion across 154 deals.

All the sectoral indices ended in red on the NSE except Metal. The top gainers from the F&O segment were Infibeam Avenues, National Aluminium Company and Yes Bank. On the other hand, the top losers were Kaveri Seed Company, Mahindra & Mahindra and Eicher Motors. In the index option segment, maximum OI continues to be seen in the 11,300-11,700 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 increased by 7.62% and reached 18.11. The 50-share Nifty was down by 150.05 points or 1.36% to settle at 10,858.25.

Nifty October 2018 futures closed at 10893.60 on Wednesday, at a premium of 35.35 points over spot closing of 10858.25, while Nifty November 2018 futures ended at 10947.75, at a premium of 89.50 points over spot closing.  Nifty October futures saw an addition of 0.78 million (mn) units, taking the total outstanding open interest (OI) to 16.89 mn units. The near month derivatives contract will expire on October 25, 2018.

From the most active contracts, Yes Bank October 2018 futures traded at a premium of 1.15 points at 213.30 compared with spot closing of 212.15. The numbers of contracts traded were 58,088.

Indiabulls Housing Finance October 2018 futures traded at a premium of 5.85 points at 945.85 compared with spot closing of 940.00. The numbers of contracts traded were 36,953.

Bajaj Finance October 2018 futures traded at a premium of 13.40 points at 2235.45 compared with spot closing of 2222.05. The numbers of contracts traded were 31,589.

Vedanta October 2018 futures traded at a premium of 1.05 points at 241.50 compared with spot closing of 240.45. The numbers of contracts traded were 31,095.

Maruti Suzuki India October 2018 futures traded at a premium of 55.80 points at 7272.80 compared with spot closing of 7217.00. The numbers of contracts traded were 20,232. 

Among Nifty calls, 11200 SP from the October month expiry was the most active call with an addition of 0.58 million open interests. The maximum OI outstanding for Calls was at 11,500 SP (3.06mn) and that for Puts was at 10,500 SP (3.76mn). The respective Support and Resistance levels of Nifty are: Resistance 10,950.28 ---- Pivot Point 10,897.02 --- Support --- 10,804.98.

The Nifty Put Call Ratio (PCR) finally stood at 1.15 for October month contract. The top five scrips with highest PCR on OI were Ajanta Pharma (2.81), Berger Paints India (2.65), Ramco Cements (2.00), Cholamandalam Investment and Finance (1.77) and Repco Home Finance (1.75).

Among most active underlying, Reliance Industries witnessed an addition of 1.71 million units of Open Interest in the October month futures contract, followed by Yes Bank witnessing a contraction of 7.03 million units of Open Interest in the October month contract, Bajaj Finance witnessed a contraction of 0.50 million units of Open Interest in the October month contract, State Bank of India witnessed an addition of 2.07 million units of Open Interest in the October month contract and Maruti Suzuki India witnessed an addition of 0.09 million units of Open Interest in the October month future contract.