Domestic index S&P CNX Nifty snapped the day’s trade below its psychological level of 11,500 on Friday amid losses in Auto and Banking stocks. The day began on a positive note, as traders remained optimistic with the International Monetary Fund (IMF) stating that the country has been one of the fastest growing large economies in the world, with growth averaging about 7% over the past five years. Some encouragement also came with a report that Finance Minister Arun Jaitley has made a case for setting up GST Council-like federal institutions to promote healthcare, rural development and agriculture sectors by optimally utilising resources of the centre and states. He said agriculture, rural development and healthcare is one area where the central government spends a lot of money on supporting farmers, creating infrastructure and building health centres for poor population.
However, markets took U-turn and pared all of their gains in noon deals, as traders turned anxious after Fitch Ratings in its latest report cut India’s economic growth forecast for the next financial year starting April 1, to 6.8% from its previous estimate of 7%, on weaker than expected momentum in the economy. The market got hit with a report that India expressed concern over the widening trade deficit with China which has ballooned to over $58 billion, with the country’s new envoy saying that addressing the issue would be his top priority. Barometer succumbed to the final-hour selling pressure, as investors were on the backfoot with a private report that the liquidity crisis in the non-banking finance companies (NBFC) space triggered by the default of infrastructure ending major IL&FS last September is continuing to have an impact on mutual fund (MF) deployments in the sector.
All sectoral indices ended in red on NSE except Realty. The top gainers from the F&O segment were NTPC, Castrol India and Jubilant Foodworks. On the other hand, the top losers were Motherson Sumi Systems, Reliance Infrastructure and Reliance Capital. In the index option segment, maximum OI continues to be seen in the 11,400-11,800 calls and 10,800 -11,200 puts indicating this is the trading range expectation.
India Volatility Index (VIX), a gauge for market’s short term expectation of volatility increased by 1.51% and reached 16.27. The 50-share Nifty was down by 64.15 points 0.56% to settle at 11,456.90.
Nifty March 2019 futures closed at 11472.40 on Friday, at a premium of 15.50 points over spot closing of 11456.90, while Nifty April 2019 futures ended at 11538.45, at a premium of 81.55 points over spot closing. Nifty March futures saw a contraction of 2.09 million (mn) units, taking the total outstanding open interest (OI) to 18.47 mn units. The near month derivatives contract will expire on March 28, 2019.
From the most active contracts, Yes Bank March 2019 futures traded at a premium of 0.45 points at 252.80 compared with spot closing of 252.35. The numbers of contracts traded were 35,892.
Reliance Industries March 2019 futures traded at a premium of 0.05 points at 1345.15 compared with spot closing of 1345.10. The numbers of contracts traded were 31,353.
Indiabulls Housing Finance March 2019 futures traded at a premium of 4.10 points at 729.40 compared with spot closing of 725.30. The numbers of contracts traded were 22,853.
Maruti Suzuki India March 2019 futures traded at a premium of 23.90 points at 6578.90 compared with spot closing of 6555.00. The numbers of contracts traded were 21,790.
HDFC Bank March 2019 futures traded at a premium of 6.50 points at 2281.60 compared with spot closing of 2275.10. The numbers of contracts traded were 20,185.
Among Nifty calls, 11,600 SP from the March month expiry was the most active call with an addition of 1.48 million open interests. Among Nifty puts, 11,500 from the March month expiry was the most active put with a contraction of 0.30 million open interests. The maximum OI outstanding for Calls was at 11,600 SP (3.86mn) and that for Puts was at 11,000 SP (3.82mn). The respective Support and Resistance levels of Nifty are: Resistance 11,541.62 ---- Pivot Point 11,488.08 --- Support --- 11,403.37.
The Nifty Put Call Ratio (PCR) finally stood at 1.40 for March month contract. The top five scrips with highest PCR on OI were Oracle Financial Services Software (2.00), Bajaj Finserv (1.97), UPL (1.52), Cholamandalam Investment and Fin (1.28) and Larsen & Toubro (1.25).
Among most active underlying, Reliance Industries witnessed a contraction of 1.58 million units of Open Interest in the March month futures contract, followed by Maruti Suzuki India witnessing a contraction of 0.16 million units of Open Interest in the March month contract, State Bank of India witnessed a contraction of 2.66 million units of Open Interest in the March month contract, ICICI Bank witnessed a contraction of 5.45 million units of Open Interest in the March month contract and Yes Bank witnessed a contraction of 18.60 million units of Open Interest in the March month future contract.
