Nifty closes with modest gains; surpasses 11,650 mark

NSE gauge -- Nifty50 -- erased major of its gain in the dying hour of trade and Nifty snapped day’s trade with modest gain, on the back of strong trend seen in other Asian markets. Nifty made a gap-up start, as traders took encouragement from on expectations that the Reserve Bank of India (RBI) may cut key lending rates by another 25 basis points on April 04, to boost economic activities amid fears of global slowdown impacting domestic growth prospects. Traders remained optimistic with a report that with the RBI’s data showing that India's foreign exchange reserves continued to surge for the third week in a row, adding $1.029 billion at $406.667 billion in the week to March 22. Sentiment was also buoyed as the Chief Economic Advisor Krishnamurthy Subramanian statement that inflation has remained well under control during the Modi government’s tenure, providing relief to the middle class and the poor. Low prices, strong monetary policy framework by the RBI and economic reforms have boosted the domestic consumption in the country.

However, most of the gains got trimmed as the market participants booked profit in fag-end trading, as anxiety remained among the local traders with Controller General of Accounts (CGA) data stating that the country's fiscal deficit touched 134.2 per cent of the full-year revised budgeted estimate at the end of February 2019, mainly due to tepid growth in revenue collections. Some optimism also came with the RBI’s data that the country's current account deficit widened to 2.5 per cent of GDP in third quarter of Financial year 2019 from 2.1 per cent a year ago, primarily on account of a higher trade deficit.

Traders were seen piling up positions in Metal, Pharma and IT stocks, while selling was witnessed in Realty, Media and Pvt Bank. The top gainers from the F&O segment were Tata Motors, Tata Motors - DVR and IRB Infrastructure Developers. On the other hand, the top losers were REC, CG Power and Industrial Solutions and DLF. In the index option segment, maximum OI continues to be seen in the 11,800-12,200 calls and 11,300-11,700 puts indicating this is the trading range expectation.

India Volatility Index (VIX), a gauge for market’s short term expectation of volatility increased by 4.77% and reached 18.00. The 50-share Nifty was up by 45.25 points 0.39% to settle at 11,669.15.

Nifty April 2019 futures closed at 11748.40 on Monday, at a premium of 79.25 points over spot closing of 11669.15, while Nifty May 2019 futures ended at 11810.65, at a premium of 141.50 points over spot closing. Nifty April futures saw a contraction of 0.45 million (mn) units, taking the total outstanding open interest (OI) to 15.99 mn units. The near month derivatives contract will expire on April 25, 2019.

From the most active contracts, Reliance Industries April 2019 futures traded at a premium of 10.20 points at 1401.80 compared with spot closing of 1391.60. The numbers of contracts traded were 38,378.

Indiabulls Housing Finance April 2019 futures traded at a premium of 14.10 points at 854.20 compared with spot closing of 840.10. The numbers of contracts traded were 30,484.

Tata Motors April 2019 futures traded at a premium of 1.20 points at 188.50 compared with spot closing of 187.30. The numbers of contracts traded were 28,940.

Maruti Suzuki India April 2019 futures traded at a premium of 33.75 points at 6873.75 compared with spot closing of 6840.00. The numbers of contracts traded were 25,157.

Tata Steel April 2019 futures traded at a premium of 3.35 points at 537.45 compared with spot closing of 534.10. The numbers of contracts traded were 24,126.  

Among Nifty calls, 11,700 SP from the April month expiry was the most active call with an addition of 0.19 million open interests. Among Nifty puts, 11,600 from the April month expiry was the most active put with an addition of 0.30 million open interests. The maximum OI outstanding for Calls was at 12,000 SP (2.27mn) and that for Puts was at 11,500 SP (2.13mn). The respective Support and Resistance levels of Nifty are: Resistance 11,714.22 ---- Pivot Point 11,679.48 --- Support --- 11,620.87.

The Nifty Put Call Ratio (PCR) finally stood at 1.11 for April month contract. The top five scrips with highest PCR on OI were Bosch (2.00), Godfrey Phillips India (1.47), Adani Power (1.42), Infosys (1.35) and Tata Motors--DVR (1.14).

Among most active underlying, Reliance Industries witnessed an addition of 0.85 million units of Open Interest in the April month futures contract, followed by State Bank of India witnessing an addition of 1.97 million units of Open Interest in the April month contract, ICICI Bank witnessed a contraction of 1.02 million units of Open Interest in the April month contract, Maruti Suzuki India witnessed a contraction of 0.06 million units of Open Interest in the April month contract and Tata Steel witnessed a contraction of 1.37 million units of Open Interest in the April month future contract.