Nifty finishes above 11,700 mark

Domestic index S&P CNX Nifty on Tuesday shot up in the last hour of trade and finished the day’s trade with a gain of around half a percent amid strong foreign fund inflows and positive global cues. Initially, the barometer made a soft opening with positive bias, as traders took support with report that the Reserve Bank of India (RBI) will again swap up to $5 billion to infuse durable liquidity in the system, a month after the first swaps saw a massive response from banks. Market participants offered up to $16.31 billion against the notified amount of $5 billion in the auction held on March 26. The next auction for three-year tenure will be held on April 23. However, traders soon turned cautious with a report that the growth of eight core sectors slowed down to 2.1% in February due to fall in output of crude oil and refinery products.
 
Buying got intensified during final hours of trade, as sentiments were buoyed with a private report that the government has been able to contain its fiscal deficit around 3.4% of the GDP in 2018-2019 by resorting to withdrawals/cash support from public accounts and savings on expenditure. Sentiment on the street also improved on Ratings agency CRISIL’s report that in its half-yearly report on credit movements has said that system wide non-performing asset (NPA) ratios will improve by 180 basis points (bps) to 8.5 percent in March 2020 from FY19 levels on the back of moderation in slippages coupled with recoveries from the bankruptcy resolutions. It also noted that public sector banks (PSBs) will turn more profitable for first time in four years.

Traders were seen piling up positions in Realty, PSU Bank and Auto, while selling was witnessed in Media, Pharma and Metal. The top gainers from the F&O segment were Suzlon Energy, Tata Motors and Tata Motors -- DVR. On the other hand, the top losers were Vodafone Idea, NBCC and NCC. 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 0.43% and reached 18.08. The 50-share Nifty was up by 44.05 points 0.38% to settle at 11,713.20.

Nifty April 2019 futures closed at 11779.50 on Tuesday, at a premium of 66.30 points over spot closing of 11713.20, while Nifty May 2019 futures ended at 11841.50, at a premium of 128.30 points over spot closing. Nifty April futures saw a contraction of 0.01 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, Tata Motors April 2019 futures traded at a premium of 0.70 points at 204.20 compared with spot closing of 203.50. The numbers of contracts traded were 53,482.

Reliance Industries April 2019 futures traded at a premium of 9.35 points at 1397.55 compared with spot closing of 1388.20. The numbers of contracts traded were 29,815.

State Bank of India April 2019 futures traded at a discount of 0.35 points at 330.55 compared with spot closing of 330.90. The numbers of contracts traded were 26,021.

Zee Entertainment Enterprises April 2019 futures traded at a premium of 1.40 points at 420.95 compared with spot closing of 419.55. The numbers of contracts traded were 24,164.

Bharti Airtel April 2019 futures traded at a premium of 2.85 points at 358.85 compared with spot closing of 356.00. The numbers of contracts traded were 18,040.

Among Nifty calls, 11,700 SP from the April month expiry was the most active call with an addition of 0.05 million open interests. Among Nifty puts, 11,700 from the April month expiry was the most active put with an addition of 0.27 million open interests. The maximum OI outstanding for Calls was at 12,000 SP (2.34mn) and that for Puts was at 11,500 SP (1.93mn). The respective Support and Resistance levels of Nifty are: Resistance 11,743.08 ---- Pivot Point 11,699.47 --- Support --- 11,669.58.

The Nifty Put Call Ratio (PCR) finally stood at 1.15 for April month contract. The top five scrips with highest PCR on OI were Bosch (1.85), Godfrey Phillips India (1.37), Adani Power (1.31), Infosys (1.27) and Mindtree (1.12).

Among most active underlying, State Bank of India witnessed an addition of 4.63 million units of Open Interest in the April month futures contract, followed by Tata Motors witnessing an addition of 10.70 million units of Open Interest in the April month contract, Reliance Industries witnessed an addition of 0.18 million units of Open Interest in the April month contract, ICICI Bank witnessed an addition of 0.38 million units of Open Interest in the April month contract and Zee Entertainment Enterprises witnessed an addition of 0.16 million units of Open Interest in the April month future contract.