Nifty finishes choppy session on higher note

After a choppy first session, key equity benchmark -- Nifty -- finished Tuesday’s trading session on higher note on the back of extensive buying towards the fag-end amid fresh inflows by foreign funds and positive global cues. Index started the session slightly in green, as traders took some support with the central statistics office’s (CSO) latest data showing that Indian economy is expected to grow at 7.2% in 2018-19, a tad higher from 6.7% in the previous fiscal, mainly due to improvement in the performance of agriculture and manufacturing sectors. Market soon pared all of its gains to enter into red terrain, as traders remain concerned with CRISIL’s report that India Inc. is set to report a decline in both revenue as well as profit growth numbers in the December quarter. It said revenue growth will dip by up to 5 percentage points on average to 12-13%.

Market sentiments remained in lackadaisical mood with a report that the growth in direct tax collection in the first nine months of the year was marginally lower than the rate of 14.4% required to meet the budget estimate of Rs 11.5 lakh crore for direct taxes in FY19. The net (post-refunds) direct tax collection for April-December period this fiscal was Rs 7.43 lakh crore, up 13.6% from the year-ago period. Barometer regained its momentum in last leg of the trade as investors turned optimistic with a private report expecting that the government to maintain fiscal deficit target of 3.2-3.3 percent. Market participants took note of Reserve Bank of India (RBI) Governor Shaktikanta Das’ statement that necessary steps would be taken if liquidity shortage arises in the economy, even as liquidity needs are largely met at present.

Traders were seen piling up positions in PSU Bank, Pharma and PVT Bank, while selling was witnessed in Media, FMCG and IT. The top gainers from the F&O segment were SREI Infrastructure Finance, Union Bank of India and Page Industries. On the other hand, the top losers were Havells India, Dish TV India and Zee Entertainment Enterprises. In the index option segment, maximum OI continues to be seen in the 10,800-11,200 calls and 10,300 -10,700 puts indicating this is the trading range expectation.

India Volatility Index (VIX), a gauge for market’s short term expectation of volatility decreased by 3.70% and reached 15.70. The 50-share Nifty was up by 30.35 points 0.28% to settle at 10,802.15.

Nifty January 2019 futures closed at 10844.65 on Tuesday, at a premium of 42.50 points over spot closing of 10802.15, while Nifty February 2019 futures ended at 10877.65, at a premium of 75.50 points over spot closing. Nifty January futures saw an addition of 0.42 million (mn) units, taking the total outstanding open interest (OI) to 25.45 mn units. The near month derivatives contract will expire on January 31, 2019.

From the most active contracts, Yes Bank January 2019 futures traded at a premium of 1.60 points at 193.40 compared with spot closing of 191.80. The numbers of contracts traded were 30,104.

ICICI Bank January 2019 futures traded at a premium of 1.15 points at 380.45 compared with spot closing of 379.30. The numbers of contracts traded were 25,703.

Tata Elxsi January 2019 futures traded at a premium of 4.50 points at 976.80 compared with spot closing of 972.30. The numbers of contracts traded were 22,053.

Reliance Industries January 2019 futures traded at a premium of 8.50 points at 1109.50 compared with spot closing of 1101.00. The numbers of contracts traded were 21,061.

Sun Pharmaceutical Industries January 2019 futures traded at a premium of 0.70 points at 449.45 compared with spot closing of 448.75. The numbers of contracts traded were 19,410.

Among Nifty calls, 11,000 SP from the January month expiry was the most active call with a contraction of 0.14 million open interests. Among Nifty puts, 10,700 SP from the January month expiry was the most active put with an addition of 0.32 million open interests. The maximum OI outstanding for Calls was at 11,000 SP (3.86mn) and that for Puts was at 10,500 SP (3.96mn). The respective Support and Resistance levels of Nifty are: Resistance 10,835.98 ---- Pivot Point 10,784.62 --- Support --- 10,750.78

The Nifty Put Call Ratio (PCR) finally stood at 1.16 for January month contract. The top five scrips with highest PCR on OI were Torrent Pharmaceuticals (1.29), Bharti Infratel (1.27), SREI Infrastructure Finance (1.20), Ramco Cements (1.11) and Page Industries (1.05).

Among most active underlying, ICICI Bank witnessed an addition of 11.63 million units of Open Interest in the January month futures contract, followed by SBI witnessing an addition of 1.08 million units of Open Interest in the January month contract, Reliance Industries witnessed an addition of 0.81 million units of Open Interest in the January month contract, Axis Bank witnessed a contraction of 0.15 million units of Open Interest in the January month contract and Tata Elxsi witnessed an addition of 0.02 million units of Open Interest in the January month future contract.