Nifty ends in red terrain; breaches 10,800 mark

Key Indian benchmark -- Nifty 50 -- finished Wednesday’s trading day on negative note, amid weak global cues. Nifty made a pessimistic start, as traders remained concerned with Niti Aayog Vice Chairman Rajiv Kumar’s statement that the country’s economy is likely to bounce back during the fourth quarter at a faster rate to match the overall projection for the current fiscal, but, he added that the economy is unlikely to recover in the third quarter from the slow pace during the last quarter. Traders remained cautions with private report stating that listed companies accounted for a little less than a third of the corporate tax in FY18, down from nearly 40% in FY17 and 49% a decade ago. Besides, another private report showed that the sudden move to demonetise a bulk of Indian currency in circulation and the deteriorating agrarian distress in the country have exposed the consequences of financial exclusion.

Market traded choppy in the second half of the trade with frontline gauges traded tad below their neutral lines. Traders shrugged off a monthly survey indicating that the country's services sector activity in November expanded at the quickest pace since July, driven by new work orders and favourable market conditions, which in turn led to a continued rise in jobs. The seasonally adjusted Nikkei India Services Business Activity Index rose to a four-month high of 53.7 in November, from 52.2 in October. Meanwhile, Reserve Bank of India (RBI) kept the repo rate unchanged at 6.5 per cent in its December policy review. The reverse repo rate has also been maintained at 6.25 per cent.

All the sectoral indices ended in red on the NSE except IT. The top gainers from the F&O segment were Arvind, Hindustan Unilever and DLF. On the other hand, the top losers were Bharat Forge, Reliance Infrastructure and Reliance Capital. In the index option segment, maximum OI continues to be seen in the 10,900-11,200 calls and 9,900 -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 1.56% and reached 18.39. The 50-share Nifty was down by 84.60 points 0.80% to settle at 10,782.90.

Nifty December 2018 futures closed at 10827.65 on Wednesday, at a premium of 44.75 points over spot closing of 10782.90, while Nifty January 2019 futures ended at 10874.25, at a premium of 91.35 points over spot closing. Nifty December futures saw an addition of 0.26 million (mn) units, taking the total outstanding open interest (OI) to 20.33 mn units. The near month derivatives contract will expire on December 27, 2018.

From the most active contracts, Sun Pharmaceutical Industries December 2018 futures traded at a discount of 2.15 points at 415.05 compared with spot closing of 417.20. The numbers of contracts traded
were 58,456 .

Yes Bank December 2018 futures traded at a premium of 1.10 points at 174.20 compared with spot closing of 173.10. The numbers of contracts traded were 26,115.

Reliance Industries December 2018 futures traded at a premium of 3.10 points at 1161.25 compared with spot closing of 1158.15. The numbers of contracts traded were 23,353.

Indiabulls Housing Finance December 2018 futures traded at a premium of 5.25 points at 777.25 compared with spot closing of 772.00. The numbers of contracts traded were 15,822.

Bharat Forge December 2018 futures traded at a premium of 2.75 points at 533.00 compared with spot closing of 530.25. The numbers of contracts traded were 15,801. 

Among Nifty calls, 11000 SP from the December month expiry was the most active call with an addition of 0.05 million open interests. Among Nifty puts, 10,800 SP from the December month expiry was the most active put with a contraction of 0.16 million open interests. The maximum OI outstanding for Calls was at 11,000 SP (2.78mn) and that for Puts was at 10,000 SP (3.89mn). The respective Support and Resistance levels of Nifty are: Resistance 10,819.98 ---- Pivot Point 10,783.97 --- Support --- 10,746.88.

The Nifty Put Call Ratio (PCR) finally stood at 1.24 for December month contract. The top five scrips with highest PCR on OI were V-Guard Industries (3.65), Mangalore Refinery & Petrochemicals (2.70), Oriental Bank of Commerce (1.17), Infosys (1.15) and Cholamandalam Investment and Finance (1.04).

Among most active underlying, Sun Pharmaceutical Industries witnessed an addition of 4.29 million units of Open Interest in the December month futures contract, followed by Reliance Industries witnessing an addition of 0.05 million units of Open Interest in the December month contract, Hindustan Unilever witnessed a contraction of 0.09 million units of Open Interest in the December month contract, State Bank of India witnessed an addition of 0.10 million units of Open Interest in the December month contract and Maruti Suzuki India witnessed an addition of 0.04 million units of Open Interest in the December month future contract.