Nifty keeps head above water; surpasses 11,650 mark

NSE gauge -- Nifty50 --  kept its head above water throughout Friday, surpassing its psychological level of 11,650 despite mixed global cues. The day began on a positive note, as traders took encouragement with Finance Secretary Subhash Chandra Garg’s statement that the government is close of meeting fiscal deficit target of 3.4 per cent for 2018-19. The government in the interim Budget in February revised upward the fiscal deficit target to 3.4 per cent from 3.3 per cent of Gross Domestic Product (GDP) estimated earlier for the financial year ended March 31. Traders remain energized with report that the Income Tax department said it added 1.07 crore new taxpayers while the number of ‘dropped filers' came down to 25.22 lakh in 2017-18, showing the positive impact of demonetisation.

In the early noon session, the index trimmed some of its gains, as market-men got anxious with Fitch Ratings kept India’s sovereign rating unchanged at the lowest investment grade of BBB- with a stable outlook. This is the 13th year in a row that Fitch has rated India at BBB-. As the day progressed the gauges regained traction in the last hour of trade and hit fresh intraday high, as local investors cheered with Finance Minister Arun Jaitley’s statement that India’s growth has stabilised between 7-7.5 per cent and irrespective of global trends, domestic consumption is going to increase. He also said that if India can maintain its position as the fastest growing major economy in the world for the next 10 years, it could become a reasonably middle-income economy, reducing poverty to negligible levels.

All sectoral indices ended in green on NSE except FMCG and PSU Bank. The top gainers from the F&O segment were KSS, FCS Software Solutions and Sujana Universal Industries. On the other hand, the top losers were Torrent Pharmaceuticals, CG Power and Industrial Solutions and Arvind. 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 decreased by 1.38% and reached 18.39. The 50-share Nifty was up by 67.95 points 0.59% to settle at 11,665.95.

Nifty April 2019 futures closed at 11760.75 on Friday, at a premium of 94.80 points over spot closing of 11665.95, while Nifty May 2019 futures ended at 11824.60, at a premium of 158.65 points over spot closing. Nifty April futures saw an addition of 0.37 million (mn) units, taking the total outstanding open interest (OI) to 15.85 mn units. The near month derivatives contract will expire on April 25, 2019.

From the most active contracts, Indiabulls Housing Finance April 2019 futures traded at a premium of 3.80 points at 910.60 compared with spot closing of 906.80. The numbers of contracts traded were 39,500.

Dewan Housing Finance Corporation April 2019 futures traded at a premium of 0.10 points at 165.15 compared with spot closing of 165.05. The numbers of contracts traded were 30,140.

Reliance Industries April 2019 futures traded at a premium of 9.75 points at 1365.60 compared with spot closing of 1355.85. The numbers of contracts traded were 23,645.

Tata Steel April 2019 futures traded at a premium of 1.65 points at 552.15 compared with spot closing of 550.50. The numbers of contracts traded were 19,456.

Tata Motors April 2019 futures traded at a premium of 1.15 points at 207.00 compared with spot closing of 205.85. The numbers of contracts traded were 17,983.

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, 11,600 from the April month expiry was the most active put with an addition of 0.38 million open interests. The maximum OI outstanding for Calls was at 12,000 SP (2.33mn) and that for Puts was at 11,500 SP (2.64mn). The respective Support and Resistance levels of Nifty are: Resistance 11,700.57 ---- Pivot Point 11,655.03 --- Support --- 11,620.42.

The Nifty Put Call Ratio (PCR) finally stood at 1.27 for April month contract. The top five scrips with highest PCR on OI were Bosch (1.38), Adani Power (1.31), Infosys (1.09), Godfrey Phillips India (1.00) and Bharti Airtel (0.99).

Among most active underlying, Reliance Industries witnessed a contraction of 0.14 million units of Open Interest in the April month futures contract, followed by State Bank of India witnessing an addition of 1.26 million units of Open Interest in the April month contract, Indiabulls Housing Finance witnessed an addition of 0.04 million units of Open Interest in the April month contract, Tata Steel witnessed an addition of 0.49 million units of Open Interest in the April month contract and ICICI Bank witnessed a contraction of 0.57 million units of Open Interest in the April month future contract.