Sharp selling in last hours, dragged key equity benchmark -- Nifty -- to end Wednesday’s trade near day’s low amid weak global clues, with Nifty ending below 10,850 level. Index made a cautions start as traders remain concerned with a report that the Reserve Bank of India (RBI) is worried that the National Payments Corporation of India (NPCI), which processes nearly half of all the digital payments across the country, may become a monopoly and be a too-big-to-fail entity in India's retail payments sector. However, market buying crept in early noon deals, as traders found some solace with the Reserve Bank of India’s announcement of Rs 10,000 crore bond buyback on January 24, 2019, continuing with its commitment to provide adequate liquidity. The central bank had earlier committed to purchase government securities under its open market operations for an aggregate Rs 50,000 crore in January and has so far done Rs 30,000 crore.
Market failed to keep up with the momentum and it witnessed a sharp losses in the last trading hours, as sentiment on the street weakened with a private report showed that India's industrial activity is expected to remain subdued in the near term, owing to muted domestic demand, weak global economic outlook and uncertainty among businesses over the outcome of Lok Sabha elections, 2019. Some cautiousness also came with a private report penning that it is important for India to stay the course on fiscal consolidation as aggregate deficit combining central and state deficits has not improved much in the last five years.
All the sectoral indices ended in red on the NSE except Media, Metal and Pharma. The top gainers from the F&O segment were Strides Vodafone Idea, Sun Pharmaceutical Industries and Yes Bank. On the other hand, the top losers were ICICI Prudential Life Insurance, TVS Motor Company and ITC. In the index option segment, maximum OI continues to be seen in the 10,800-11,200 calls and 10,500 -11,000 puts indicating this is the trading range expectation.
India Volatility Index (VIX), a gauge for market’s short term expectation of volatility increased by 0.56% and reached 18.09. The 50-share Nifty was down by 91.25 points 0.84% to settle at 10,831.50.
Nifty January 2019 futures closed at 10854.90 on Wednesday, at a premium of 23.40 points over spot closing of 10831.50, while Nifty February 2019 futures ended at 10891.00, at a premium of 59.50 points over spot closing. Nifty January futures saw an addition of 0.01 million (mn) units, taking the total outstanding open interest (OI) to 24.32 mn units. The near month derivatives contract will expire on January 31, 2019.
From the most active contracts, ITC January 2019 futures traded at a premium of 2.60 points at 278.60 compared with spot closing of 276.00. The numbers of contracts traded were 32,155.
Yes Bank January 2019 futures traded at a premium of 0.65 points at 197.90 compared with spot closing of 197.25. The numbers of contracts traded were 29,954.
Sun Pharmaceutical Industries January 2019 futures traded at a premium of 1.20 points at 431.60 compared with spot closing of 430.40. The numbers of contracts traded were 29,461.
Reliance Industries January 2019 futures traded at a premium of 5.65 points at 1230.10 compared with spot closing of 1224.45. The numbers of contracts traded were 24,922.
MindTree January 2019 futures traded at a premium of 4.85 points at 909.85 compared with spot closing of 905.00. The numbers of contracts traded were 15,849.
Among Nifty calls, 11,000 SP from the January month expiry was the most active call with an addition of 0.94 million open interests. Among Nifty puts, 10,900 SP from the January month expiry was the most active put with a contraction of 0.25 million open interests. The maximum OI outstanding for Calls was at 11,000 SP (4.31mn) and that for Puts was at 10,800 SP (3.20mn). The respective Support and Resistance levels of Nifty are: Resistance 10,913.55 ---- Pivot Point 10,862.75 --- Support --- 10,780.70.
The Nifty Put Call Ratio (PCR) finally stood at 1.11 for January month contract. The top five scrips with highest PCR on OI were Shree Cement (1.50), Ramco Cements (1.21),KPIT Technologies (1.20), Wipro (1.14) and Torrent Pharmaceuticals (1.14).
Among most active underlying, ITC witnessed an addition of 5.44 million units of Open Interest in the January month futures contract, followed by Reliance Industries witnessing a contraction of 0.95 million units of Open Interest in the January month contract, Sun Pharmaceutical Industries witnessed a contraction of 2.26 million units of Open Interest in the January month contract, SBI witnessed a contraction of 6.80 million units of Open Interest in the January month contract and Kotak Mahindra Bank witnessed a contraction of 0.31 million units of Open Interest in the January month future contract.
