Nifty tumbles for seventh straight session

Pressurized by weak global cues, CNX S&P Nifty ended the session with a cut of over half a percent on Thursday, extending its southward journey to seventh day in a row. The benchmark traded in red throughout the day and ended the session tad above 11,300 mark. Earlier, benchmark kick started the session in red tracking weak global cues. Traders also remain concerned with the report that the Reserve Bank of India (RBI) has warned that income support schemes and farm loan waivers would lead to fiscal slippages for the states. The RBI listed out specific factors that would drive fiscal slippages in the revised estimates of 2018-19, including farm loan waivers and income support schemes. Adding to the pessimism, former finance minister P Chidambaram stated that macroeconomic indicators confirm that the Indian economy has entered a disastrous phase of slowdown. He further said the Finance Ministry's report is a damning indictment of the state of the economy in the country.

Key indices recouped losses in afternoon session and came off their intraday low point, as traders found some solace with a report that India is expecting improvement in its ranking in the World Bank’s doing business report this year particularly in indicators such as paying taxes and trading across borders. But, the trade remained in negative trajectory, as traders were cautious with a private report stating that the Indian economy is running the risk of a structural crisis, and could soon be ensnared in a 'middle-income trap', eventually becoming like Brazil or South Africa. Lower-than-expected Q4 earnings along with weakness in the rupee also dampened the trading sentiment.

Traders were seen piling up positions in Media, IT and Realty, while selling was witnessed in Metal, Bank and PVT Bank. The top gainers from the F&O segment were Jet Airways, Dish TV India and Zee Entertainment Enterprises. On the other hand, the top losers were Suzlon Energy, CG Power and Industrial Solutions and Jindal Steel & Power. In the index option segment, maximum OI continues to be seen in the 11,900-12,100 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 decreased by 3.34% and reached 25.48. The 50-share Nifty was down by 57.65 points or 0.51% to settle at 11,301.80.

Nifty May 2019 futures closed at 11334.80 on Thursday, at a premium of 33.00 points over spot closing of 11301.80, while Nifty June 2019 futures ended at 11379.20, at a premium of 77.40 points over spot closing. Nifty May futures saw a contraction of 1.28 million (mn) units, taking the total outstanding open interest (OI) to 17.95 mn units. The near month derivatives contract will expire on May 30, 2019.

From the most active contracts, Reliance Industries May 2019 futures traded at a premium of 10.00 points at 1263.15 compared with spot closing of 1253.15. The numbers of contracts traded were 54,261.

Yes Bank May 2019 futures traded at a premium of 0.05 points at 171.20 compared with spot closing of 171.15. The numbers of contracts traded were 44,249.

Zee Entertainment Enterprises May 2019 futures traded at a premium of 0.40 points at 359.85 compared with spot closing of 359.45. The numbers of contracts traded were 30,664.

ICICI Bank May 2019 futures traded at a premium of 1.55 points at 383.55 compared with spot closing of 382.00. The numbers of contracts traded were 25,916.

Tata Motors May 2019 futures traded at a premium of 1.05 points at 187.25 compared with spot closing of 186.20. The numbers of contracts traded were 17,348.

Among Nifty calls, 11,350 SP from the May month expiry was the most active call with an addition of 0.01 million open interests. Among Nifty puts, 11,300 from the May month expiry was the most active put with a contraction of 0.02 million open interests. The maximum OI outstanding for Calls was at 12,000 SP (1.76 mn) and that for Puts was at 11,000 SP (2.56 mn). The respective Support and Resistance levels of Nifty are: Resistance 11,354.58 ---- Pivot Point 11,304.82 --- Support --- 11,252.03.

The Nifty Put Call Ratio (PCR) finally stood at 1.16 for May month contract. The top five scrips with highest PCR on OI were Mindtree (2.09), Just Dial (1.44), ICICI Prudential Life Insurance (1.31), Bosch (1.24) and NIIT Technologies (1.19).

Among most active underlying, Reliance Industries witnessed a contraction of 0.11 million units of Open Interest in the May month futures contract, followed by Yes Bank witnessing a contraction of 3.33 million units of Open Interest in the May month contract, State Bank of India witnessed a contraction of 0.47 million units of Open Interest in the May month contract, ICICI Bank witnessed a contraction of 0.23 million units of Open Interest in the May month contract and Zee Entertainment Enterprises witnessed a contraction of 0.71 million units of Open Interest in the May month future contract.