Posting best closing level in nearly a month, key equity benchmark -- Nifty -- garnered a gain of around one and a half percent on Tuesday, after lower retail inflation numbers for December raised RBI rate cut hopes, leading to buying in rate-sensitive stocks. Nifty made a positive start, as traders remained optimistic with apex industry body ASSOCHAM’s statement that Wholesale Price Index (WPI) has recorded 3.80 per cent for December 2018 as compared to 4.64 per cent for the previous month due to sharp decline in price of vegetables, onion and fruits. The continuing deceleration in the growth of WPI and softening of global fuel prices provide ample opportunity to MPC (monetary policy committee) to cut down policy rate at earliest which will kick start investment and revival in overall industrial growth.
Barometer continued its strong run in the second half of trade to end near intraday high, as traders were energized with a report that India is likely be a larger economy than the US by 2030, while China will top the list and Indonesia will figure among the top five. India will likely be the main mover, with its trend growth accelerating to 7.8% by 2020s, partly due to ongoing reforms, including introduction of GST and the Insolvency and Bankruptcy Code (IBC). Trader sentiment remained largely positive with a report that the total of investments during 2018 by private equity (PE) and venture capital (VC) companies was $35.1 billion (nearly Rs 2.5 trillion), surpassing the previous high of $26.1 billion (Rs 1.8 trillion) in 2017 by 35 per cent.
All the sectoral indices ended in green on the NSE. The top gainers from the F&O segment were Infibeam Avenues, Godfrey Phillips India and Castrol India. On the other hand, the top losers were Dish TV India, CEAT and Dabur India. 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 3.56% and reached 15.58. The 50-share Nifty was up by 149.20 points 1.39% to settle at 10,886.80.
Nifty January 2019 futures closed at 10928.40 on Tuesday, at a premium of 41.60 points over spot closing of 10886.80, while Nifty February 2019 futures ended at 10957.95, at a premium of 71.15 points over spot closing. Nifty January futures saw a contraction of 0.74 million (mn) units, taking the total outstanding open interest (OI) to 25.52 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 0.50 points at 203.80 compared with spot closing of 203.30. The numbers of contracts traded were 49,980.
Reliance Industries January 2019 futures traded at a premium of 5.05 points at 1136.00 compared with spot closing of 1130.95. The numbers of contracts traded were 48,166.
Infosys January 2019 futures traded at a discount of 1.35 points at 726.95 compared with spot closing of 728.30. The numbers of contracts traded were 26,221.
TCS January 2019 futures traded at a premium of 4.10 points at 1870.10 compared with spot closing of 1866.00. The numbers of contracts traded were 23,947.
Bajaj Finance January 2019 futures traded at a premium of 11.70 points at 2611.05 compared with spot closing of 2599.35. The numbers of contracts traded were 13,730.
Among Nifty calls, 11,000 SP from the January month expiry was the most active call with a contraction of 0.87 million open interests. Among Nifty puts, 10,800 SP from the January month expiry was the most active put with an addition of 0.95 million open interests. The maximum OI outstanding for Calls was at 11,000 SP (4.05mn) and that for Puts was at 10,500 SP (4.09mn). The respective Support and Resistance levels of Nifty are: Resistance 10,929.98 ---- Pivot Point 10,853.77 --- Support --- 10,810.58
The Nifty Put Call Ratio (PCR) finally stood at 1.29 for January month contract. The top five scrips with highest PCR on OI were Shree Cement (2.00), Infosys (1.16), Power Finance Corp (0.99), Page Industries (0.97) and Union Bank of India (0.97).
Among most active underlying, Reliance Industries witnessed a contraction of 2.40 million units of Open Interest in the January month futures contract, followed by Infosys witnessing a contraction of 2.21 million units of Open Interest in the January month contract, TCS witnessed a contraction of 1.03 million units of Open Interest in the January month contract, Yes Bank witnessed a contraction of 5.43 million units of Open Interest in the January month contract and ICICI Bank witnessed an addition of 3.02 million units of Open Interest in the January month future contract.
