Nifty ends on marginally higher note; Pharma, Realty stocks surge

Key equity barometer -- Nifty -- ended Friday’s trading session on marginally higher note, led by gains in Pharma and Realty stocks, marking the highest closing in nearly two months. Barometer made a positive start as traders were optimistic with economic policy think-tank the National Council of Applied Economic Research’s (NCAER) report stating that Indian economy is projected to grow at 7-7.4 per cent in the current fiscal. It added that the real agriculture Gross Value Added (GVA) is envisaged to grow at 3 per cent and real industry GVA at 7 per cent in 2018-19. Some encouragement also came with report that the Reserve Bank of India (RBI) on November 29 relaxed rules for non-banking financial companies (NBFCs) to sell or securitise their loan books, in a bid to ease persistent stress in the sector.

However, market turned negative in the afternoon session, as traders maintained a cautious approach with a private report stating that India’s Gross Domestic Product (GDP) growth is expected to slow down to 7.4% in the July-September quarter of the current financial year, down by 0.8 percentage points from the previous quarter. But, market soon turned positive again as traders found support with Chairman of the Economic Advisory Council to Prime Minister (EAC-PM) Bibek Debroy’s statement that the government is looking to reform tax structures such that there is no deviation from fiscal consolidation. Besides, the rupee showing gains against the US dollar on easing crude oil prices supported investors’ mood.

Traders were seen piling up positions in Realty, Pharma and IT stocks, while selling was witnessed in PSU Bank, Metal and Pvt Bank. The top gainers from the F&O segment were Reliance Communications, Repco Home Finance and Strides Pharma Science. On the other hand, the top losers were Oil India, Vodafone Idea and Power Finance Corporation. In the index option segment, maximum OI continues to be seen in the 10,900-11,200 calls and 9900 -10,200 puts indicating this is the trading range expectation.

India Volatility Index (VIX), a gauge for market’s short term expectation of volatility increased by 2.49% and reached 19.16. The 50-share Nifty was up by 18.05 points 0.17% to settle at 10,876.75.

Nifty December 2018 futures closed at 10900.65 on Friday, at a premium of 23.90 points over spot closing of 10876.75, while Nifty January 2019 futures ended at 10947.25, at a premium of 70.50 points over spot closing. Nifty December futures saw an addition of 0.13 million (mn) units, taking the total outstanding open interest (OI) to 19.44 mn units. The near month derivatives contract will expire on December 27, 2018.

From the most active contracts, Yes Bank December 2018 futures traded at a discount of 0.05 points at 170.45 compared with spot closing of 170.50. The numbers of contracts traded were 66,203.

Reliance Industries December 2018 futures traded at a premium of 4.95 points at 1172.05 compared with spot closing of 1167.10. The numbers of contracts traded were 28,862.

Indiabulls Housing Finance December 2018 futures traded at a premium of 4.60 points at 717.55 compared with spot closing of 712.95. The numbers of contracts traded were 18,351.

HDFC Bank December 2018 futures traded at a premium of 12.35 points at 2132.80 compared with spot closing of 2120.45. The numbers of contracts traded were 17,708.

Indian Oil Corporation December 2018 futures traded at a discount of 1.85 points at 133.15 compared with spot closing of 135.00. The numbers of contracts traded were 17,064.

Among Nifty calls, 11100 SP from the December month expiry was the most active call with an addition of 0.17 million open interests. Among Nifty puts, 10,800 SP from the December month expiry was the most active put with an addition of 0.45 million open interests. The maximum OI outstanding for Calls was at 11,000 SP (2.54mn) and that for Puts was at 10,000 SP (3.78mn). The respective Support and Resistance levels of Nifty are: Resistance 10,921.10 ---- Pivot Point 10,878.10 --- Support --- 10,833.75.

The Nifty Put Call Ratio (PCR) finally stood at 1.27 for December month contract. The top five scrips with highest PCR on OI were V-Guard Industries (2.41), SREI Infrastructure Finance (2.41), Godrej Consumer Products (1.77), Infosys (1.55) and Equitas Holdings (1.54).

Among most active underlying, Reliance Industries witnessed an addition of 1.15 million units of Open Interest in the December month futures contract, followed by Yes Bank witnessing a contraction of 2.65 million units of Open Interest in the December month contract, ICICI Bank witnessed a contraction of 1.73 million units of Open Interest in the December month contract, State Bank of India witnessed an addition of 0.94 million units of Open Interest in the December month contract and Maruti Suzuki India witnessed a contraction of 0.02 million units of Open Interest in the December month future contract.