Nifty ends flat with negative bias

Key equity benchmark -- Nifty -- closed Thursday’s choppy session on a flat note with negative bias, as tension between the government and the RBI continued to brew. Nifty settled at 10,380 mark, down by 6 points from the previous close. Market made a positive start but erased most of its early gains and traded flat in first half of the session, with the commerce and industry ministry’s data showed that growth of eight infrastructure sectors slowed down to 4.3% in September, the lowest in the last four months, as production of crude oil and natural gas declined. Investors were on the back foot with a private report stating that India, which is the second-most populated nation in the world and on the verge of becoming the youngest country, will start ageing in next 15 years. This 15-year window is the best time to create job opportunities and capitalize on country’s rich demographic dividend.

However, the Nifty erased losses in the last hour of trade, as investors found some solace with the survey report that the Indian manufacturing sector strengthened further in the month of October, on account of stronger order inflows and job creation. As per the survey report, the Nikkei India Manufacturing Purchasing Managers’ Index (PMI) - a composite single-figure indicator of manufacturing performance - improved to 53.1 in October from 52.2 in September. Some comfort also came with a report that India jumped 23 spots in the World Bank’s ease of doing business ranking to 77th place, becoming the top ranked country in South Asia for the first time and third among the BRICS. As per the report, the biggest gain was in construction permit where India climbed 129 ranks to 52nd place on the back of targeted government effort to remove hurdles.

Traders were seen piling up positions in Realty, Metal and PSU Bank stocks, while selling was witnessed in IT, Pharma and FMCG. The top gainers from the F&O segment were PC Jeweller, Reliance Communications and Yes Bank. On the other hand, the top losers were Canara Bank, Exide Industries and Hexaware Technologies. In the index option segment, maximum OI continues to be seen in the 10,500-10,800 calls and 9,900 -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 3.06% and reached 19.19. The 50-share Nifty was down by 6.15 points or 0.06% to settle at 10,380.45.

Nifty November 2018 futures closed at 10413.45 on Thursday, at a premium of 33.00 points over spot closing of 10380.45, while Nifty December 2018 futures ended at 10459.60, at a premium of 79.15 points over spot closing. Nifty November futures saw a contraction of 0.04 million (mn) units, taking the total outstanding open interest (OI) to 23.01 mn units. The near month derivatives contract will expire on November 29, 2018.

From the most active contracts, Yes Bank November 2018 futures traded at a discount of 0.75 points at 204.85 compared with spot closing of 205.60. The numbers of contracts traded were 41,925.

Reliance Industries November 2018 futures traded at a premium of 6.65 points at 1061.65 compared with spot closing of 1055.00. The numbers of contracts traded were 31,687.

HDFC Bank November 2018 futures traded at a premium of 6.40 points at 1918.10 compared with spot closing of 1911.70. The numbers of contracts traded were 30,365.

Larsen & Toubro November 2018 futures traded at a premium of 1.55 points at 1332.65 compared with spot closing of 1331.10. The numbers of contracts traded were 29,949.

IndusInd Bank November 2018 futures traded at a premium of 7.30 points at 1468.90 compared with spot closing of 1461.60. The numbers of contracts traded were 29,193.

Among Nifty calls, 10500 SP from the November month expiry was the most active call with an addition of 0.22 million open interests. Among Nifty puts, 10,000 SP from the November month expiry was the most active put with an addition of 0.59 million open interests. The maximum OI outstanding for Calls was at 10,700 SP (2.47mn) and that for Puts was at 10,000 SP (5.08mn). The respective Support and Resistance levels of Nifty are: Resistance 10,434.27 ---- Pivot Point 10,388.08 --- Support --- 10,334.27.

The Nifty Put Call Ratio (PCR) finally stood at 1.49 for November month contract. The top five scrips with highest PCR on OI were PC Jeweller (2.05), Godrej Consumer Products (1.93), CESC (1.43), SRF (1.25) and Bajaj Auto (1.25).

Among most active underlying, Reliance Industries witnessed an addition of 0.83 million units of Open Interest in the November month futures contract, followed by Larsen & Toubro witnessing an addition of 0.35 million units of Open Interest in the November month contract, State Bank of India witnessed a contraction of 3.13 million units of Open Interest in the November month contract, ICICI Bank witnessed a contraction of 4.43 million units of Open Interest in the November month contract and Yes Bank witnessed a contraction of 4.88 million units of Open Interest in the November month future contract.