Nifty ends on higher note; tanks over 10,350

Overcoming early hiccup, key equity benchmark -- Nifty -- ended Wednesday’s trading session on a higher note with a huge gain of around two percent. The Nifty barometer settled with ample of gains powered by gains in IT and banking stocks. The index made a cautions start amid concerns that the Reserve Bank of India’s (RBI) governor Urjit Patel may resign today owing to differences with the central government. Traders remained on the sideline on RBI’s report showing that India Inc’s foreign borrowing more than halved to $1.71 billion in September. Meanwhile, the high level the Financial Stability and Development Council (FSDC) meeting chaired by Finance Minister Arun Jaitley discussed liquidity issues being faced by the non-banking financial companies. Investors also remained jittery with a report stating that Indian stocks are over-valued and that earnings growth could slow in the wake of macro headwinds, foreign funds have been taking risk off the table.

However, market started northern journey crossing the neutral line and ending the trading session near intraday highs, as market participants turned optimistic with report that Commerce and Industry Minister Suresh Prabhu hinting at improvement in India’s ranking in the World Bank’s ease of doing business report, to be released on Wednesday. India jumped 30 places to rank 100th among 190 nations in the last year’s World Bank’s ease of doing business index. Traders took encouragement with DIPP Secretary Ramesh Abhishek’s statement the Department of Industrial Policy and Promotion (DIPP) is working with the tax department and regulators to ease the rules and laws for startups to support budding entrepreneurs.

All the sectoral indices ended in green on the NSE except Metal. The top gainers from the F&O segment were Torrent Power, Cummins India and IRB Infrastructure Developers. On the other hand, the top losers were Jet Airways (India), Tata Global Beverages and Coal India. 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 decreased by 3.44% and reached 19.79. The 50-share Nifty was up by 188.20 points or 1.85% to settle at 10,386.60.

Nifty November 2018 futures closed at 10398.40 on Wednesday, at a premium of 11.80 points over spot closing of 10386.60, while Nifty December 2018 futures ended at 10446.10, at a premium of 59.50 points over spot closing. Nifty November futures saw an addition of 1.21 million (mn) units, taking the total outstanding open interest (OI) to 23.05 mn units. The near month derivatives contract will expire on November 29, 2018.

From the most active contracts, HDFC Bank November 2018 futures traded at a premium of 14.25 points at 1920.25 compared with spot closing of 1906.00. The numbers of contracts traded were 43,412.

Reliance Industries November 2018 futures traded at a premium of 7.85 points at 1066.05 compared with spot closing of 1058.20. The numbers of contracts traded were 38,413.

IndusInd Bank November 2018 futures traded at a premium of 11.65 points at 1432.15 compared with spot closing of 1420.50. The numbers of contracts traded were 34,768.

Yes Bank November 2018 futures traded at a premium of 0.95 points at 189.30 compared with spot closing of 188.35. The numbers of contracts traded were 29,145.

Indiabulls Housing Finance November 2018 futures traded at a premium of 3.10 points at 835.10 compared with spot closing of 832.00. The numbers of contracts traded were 29,116.

The maximum OI outstanding for Calls was at 10,700 SP (2.22mn) and that for Puts was at 10,000 SP (4.49mn). The respective Support and Resistance levels of Nifty are: Resistance 10,486.70 ---- Pivot Point 10,295.90 --- Support --- 10,195.80.

The Nifty Put Call Ratio (PCR) finally stood at 1.50 for November month contract. The top five scrips with highest PCR on OI were CESC (4.39), Godrej Consumer Products (2.26), Godrej Industries (1.94), PC Jeweller (1.56) and Bajaj Auto (1.31).

Among most active underlying, Reliance Industries witnessed an addition of 0.69 million units of Open Interest in the November month futures contract, followed by ICICI Bank witnessing an addition of 0.10 million units of Open Interest in the November month contract, State Bank of India witnessed an addition of 2.36 million units of Open Interest in the November month contract, Tata Steel witnessed a contraction of 1.82 million units of Open Interest in the November month contract and Tech Mahindra witnessed an addition of 0.18 million units of Open Interest in the November month future contract.