Nifty resumes southward journey; gives up 10,200-mark

Key equity benchmark -- Nifty -- resumed southward journey after witnessing jubilation in the previous session and finished Tuesday’s trading session on pessimistic note amid lingering US-China trade war concerns and subdued trade across Asia. Nifty barometer gives up 10,200-mark dragged by Metal, Bank and Financial Services stocks. The index made a cautious start and traded marginally in red zone, as investors remained concerned with Reserve Bank of India’s (RBI) data showing that Indian companies’ investment in their overseas ventures fell by 47% to $1.54 billion in September 2018. Indian companies had invested $2.91 billion in their joint ventures (JVs) and wholly-owned subsidiaries (WoS) abroad during September 2017. However market soon recovered from the early losses and started trading in green terrain, as market participants took some support from a report that India and Japan signed a pact to raise the scope of a bilateral currency swap arrangement to a record $75 billion, aimed at bringing in greater stability in the foreign exchange and capital markets, amid a slide in the rupee in recent months.

However, market once again entered into red trajectory in the second half of the session, as traders turned concerned with a private report stating that high oil prices are hurting consumers and could also have adverse implications for producers. Major emerging Asian economies such as India and Indonesia have been hit hard this year by rising crude oil prices. Streets also remained disappointed with credit rating agency, Crisil’s latest report that depreciating rupee puts nearly half of the solar power capacities under implementation worth around Rs 28,000 crore at viability risk.

Traders were seen piling up positions in Media, IT and PSU Bank stocks, while selling was witnessed in Metal, Financial Services and PVT Bank. The top gainers from the F&O segment were Dewan Housing Finance Corporation, Just Dial and Jet Airways. On the other hand, the top losers were CESC, Hindustan Petroleum Corporation and Chennai Petroleum Corporation. In the index option segment, maximum OI continues to be seen in the 10,500-11,000 calls and 9,800 -10,200 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 3.42% and reached 20.50. The 50-share Nifty was down by 52.45 points or 0.51% to settle at 10,198.40.

Nifty November 2018 futures closed at 10229.25 on Tuesday, at a premium of 30.85 points over spot closing of 10198.40, while Nifty December 2018 futures ended at 10275.90, at a premium of 77.50 points over spot closing. Nifty November futures saw a contraction of 0.24 million (mn) units, taking the total outstanding open interest (OI) to 21.84 mn units. The near month derivatives contract will expire on November 29, 2018.

From the most active contracts, Reliance Industries November 2018 futures traded at a premium of 4.60 points at 1061.50 compared with spot closing of 1056.90. The numbers of contracts traded were 33,893.

ICICI Bank November 2018 futures traded at a premium of 1.40 points at 347.40 compared with spot closing of 346.00. The numbers of contracts traded were 29,629.

State Bank of India November 2018 futures traded at a discount of 0.05 points at 273.85 compared with spot closing of 273.90. The numbers of contracts traded were 26,115.

Yes Bank November 2018 futures traded at a premium of 0.45 points at 183.05 compared with spot closing of 182.60. The numbers of contracts traded were 24,890.

Dewan Housing Finance Corporation November 2018 futures traded at a discount of 0.90 points at 207.60 compared with spot closing of 208.50. The numbers of contracts traded were 24,690.

Among Nifty calls, 10500 SP from the November month expiry was the most active call with an addition of 0.15 million open interests. Among Nifty puts, 10,000 SP from the November month expiry was the most active put with an addition of 0.35 million open interests. The maximum OI outstanding for Calls was at 10,700 SP (2.09mn) and that for Puts was at 10,000 SP (4.23mn). The respective Support and Resistance levels of Nifty are: Resistance 10,263.88 ---- Pivot Point 10,219.62 --- Support --- 10,154.13.

The Nifty Put Call Ratio (PCR) finally stood at 1.39 for November month contract. The top five scrips with highest PCR on OI were Godrej Consumer Products (2.43), Apollo Tyres (1.34), PC Jeweller (1.29), Bajaj Auto (1.28) and Ajanta Pharma (1.27).

Among most active underlying, ICICI Bank witnessed an addition of 2.59 million units of Open Interest in the November month futures contract, followed by Reliance Industries witnessing an addition of 0.91 million units of Open Interest in the November month contract, State Bank of India witnessed a contraction of 0.70 million units of Open Interest in the November month contract, Maruti Suzuki witnessed an addition of 0.02 million units of Open Interest in the November month contract and HDFC Bank witnessed an addition of 0.26 million units of Open Interest in the November month future contract.