Nifty finishes marginally in green

After seesawing between the green and red territory domestic benchmark CNX S&P Nifty snapped the session marginally in green on Tuesday. Markets made a slightly positive start, as traders took some support with report that the commerce ministry is considering a major export promotion scheme to ensure expeditious refund of central and state taxes and levies to boost shipments in the wake of global challenges at trade front. However, markets soon wiped out all of their early gains to enter into negative territory, as traders turned cautious with the Federation of Indian Chambers of Commerce & Industry’s (FICCI) statement that India’s slowing economic growth is of serious concern and the country needs to urgently cut tax and interest rates to revive the economy. The economy grew 6.6 per cent in the three months to December - the slowest pace in five quarters. It added that the recent signs of a slowdown in the economy stem not only from slow growth in investments and subdued exports but also from weakening growth in consumption demand.

Market remained volatile for the most part of the session, as traders got anxious with rating agency Ind-Ra’s statement that India’s GDP growth during the fiscal 2018-19 is expected at 6.9 per cent, marginally lower than CSO’s advance estimate of 7 per cent. It also urged the new government to take short-term measures to arrest the slowdown in the economy. Market regained some momentum in last leg of the trade and managed to close the session marginally in green, as traders found some solace with a report which stated that Industry body Confederation of Indian Industry (CII) has called for lowering corporate tax rate, kick-starting government expenditure and rationalisation of dispute tax resolution mechanism.

Traders were seen piling up positions in IT, Media and Metal, while selling was witnessed in PSU Bank, Auto and Financial Services. The top gainers from the F&O segment were Reliance Power, Kaveri Seed Company and NHPC. On the other hand, the top losers were IFCI, IDFC and Suzlon Energy. In the index option segment, maximum OI continues to be seen in the 12,400-12,600 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 1.65% and reached 15.92. The 50-share Nifty was up by 4.00 points or 0.03% to settle at 11,928.75.

Nifty May 2019 futures closed at 11940.75 on Tuesday, at a premium of 12.00 points over spot closing of 11928.75, while Nifty June 2019 futures ended at 11989.80, at a premium of 61.05 points over spot closing. Nifty May futures saw a contraction of 0.86 million (mn) units, taking the total outstanding open interest (OI) to 14.64 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 discount of 3.60 points at 1326.40 compared with spot closing of 1330.00. The numbers of contracts traded were 54,939.

Yes Bank May 2019 futures traded at a discount of 0.80 points at 152.60 compared with spot closing of 153.40. The numbers of contracts traded were 53,856.

ICICI Bank May 2019 futures traded at a discount of 1.80 points at 435.20 compared with spot closing of 437.00. The numbers of contracts traded were 37,046.

HDFC Bank May 2019 futures traded at a discount of 2.95 points at 2417.05 compared with spot closing of 2420.00. The numbers of contracts traded were 33,620.

Zee Entertainment Enterprises May 2019 futures traded at a premium of 1.35 points at 381.35 compared with spot closing of 380.00. The numbers of contracts traded were 31,096.

Among Nifty calls, 12,000 SP from the May month expiry was the most active call with an addition of 0.33 million open interests. Among Nifty puts, 11,900 from the May month expiry was the most active put with an addition of 0.48 million open interests. The maximum OI outstanding for Calls was at 12,500 SP (4.09 mn) and that for Puts was at 11,000 SP (3.65 mn). The respective Support and Resistance levels of Nifty are: Resistance 11,969.90 ---- Pivot Point 11,917.40 --- Support --- 11,876.25.

The Nifty Put Call Ratio (PCR) finally stood at 0.95 for May month contract. The top five scrips with highest PCR on OI were Shree Cement (4.00), Muthoot Finance (1.47), Bosch (1.40), Cummins India (1.30) and Titan Company (1.39).

Among most active underlying, Reliance Industries witnessed a contraction of 9.20 million units of Open Interest in the May month futures contract, followed by State Bank of India witnessing a contraction of 15.05 million units of Open Interest in the May month contract, ICICI Bank witnessed a contraction of 16.42 million units of Open Interest in the May month contract, Axis Bank witnessed a contraction of 9.99 million units of Open Interest in the May month contract and Punjab National Bank witnessed a contraction of 32.15 million units of Open Interest in the May month future contract.