Nifty finishes slightly in green; surpasses 11,650 mark

Key equity benchmark -- Nifty -- managed to close slightly in the green after a volatile day of trade on Tuesday, tracking positive global cues. Market started on a positive note, as traders took some encouragement with Niti Aayog CEO Amitabh Kant’s statement that circular economy has the potential to generate 1.4 crore jobs in next 5-7 years and create lakhs of new entrepreneurs. Sentiment on the street also improved with Reserve Bank of India Governor Shaktikanta Das’ statement that the central bank will not hesitate to take any required measure to maintain the financial stability of the economy. Investors also took a note of report that the government is in the process of fixing draft norms for individual insolvency and might come up with a three-tiered debt resolution system, depending on the amount of loan borrowed.

In the afternoon deals, market reversed its entire gains and traded marginally lower, as traders turned cautious with Fitch lowered India's growth forecast to 6.6 per cent for the current fiscal from 6.8 per cent projected earlier, as manufacturing and agriculture sectors showed signs of slowing down over the past year. Sentiments remained pessimistic with a private report indicating that June may end up with a deficit, with monsoon remaining poor across the country so far. It added that there is a possibility of 40 per cent deficient monsoon in the month of June in 66 per cent districts across the country. But, selling proved short-lived as market bounced back in the green in last leg of the trade, as market participants found support with state Development Commissioner (Industries) Harshadeep Kamble’s statement that Maharashtra government will soon launch the Chief Minister's Employment Generation Programme for Micro, Small and Medium Enterprises (MSMEs), which will create 10 lakh jobs in the next five years.

Traders were seen piling up positions in IT, Metal and Bank stocks, while selling was witnessed in Pharma, Auto and FMGC. The top gainers from the F&O segment were SRF, Shriram Transport Finance Company and Shree Cement. On the other hand, the top losers were Jet Airways (India), Reliance Infrastructure and Jain Irrigation Systems. In the index option segment, maximum OI continues to be seen in the 11,900-12,100 calls and 11,200-11,700 puts indicating this is the trading range expectation.

India Volatility Index (VIX), a gauge for market’s short term expectation of volatility decreased by 0.34 and reached 14.60. The 50-share Nifty was up by 19.35 points or 0.17% to settle at 11,691.50.

Nifty June 2019 futures closed at 11700.50 on Tuesday, at a premium of 9.00 points over spot closing of 11691.50, while Nifty July 2019 futures ended at 11728.95, at a premium of 37.45 points over spot closing. Nifty June futures saw a contraction of 0.52 million (mn) units, taking the total outstanding open interest (OI) to 18.34 mn units. The near month derivatives contract will expire on June 27, 2019.

From the most active contracts, Yes Bank Limited June 2019 futures traded at a premium of 0.20 points at 109.45 compared with spot closing of 109.25. The numbers of contracts traded were 62,819.

Indiabulls Housing Finance June 2019 futures traded at a premium of 3.05 points at 609.65 compared with spot closing of 606.60. The numbers of contracts traded were 42,210.

IndusInd Bank June 2019 futures traded at a premium of 4.60 points at 1410.60 compared with spot closing of 1406.00. The numbers of contracts traded were 28,237.

ICICI Bank June 2019 futures traded at a discount of 0.70 points at 421.70 compared with spot closing of 422.40. The numbers of contracts traded were 28,024.

State Bank of India June 2019 futures traded at a premium of 0.40 points at 341.20 compared with spot closing of 340.80. The numbers of contracts traded were 24,678.

Among Nifty calls, 11,800 SP from the June month expiry was the most active call with an addition of 0.12 million open interests. Among Nifty puts, 11,700 from the June month expiry was the most active put with a contraction of 0.33 million open interests. The maximum OI outstanding for Calls was at 12,000 SP (2.49 mn) and that for Puts was at 11,500 SP (2.84 mn). The respective Support and Resistance levels of Nifty are: Resistance 11,732.08 -- Pivot Point 11,686.62 -- Support -- 11,646.03.

The Nifty Put Call Ratio (PCR) finally stood at 1.20 for June month contract. The top five scrips with highest PCR on OI were Bosch (1.64), TCS (1.50), Birlasoft (1.33), Colgate-Palmolive (1.28) and MRPL (1.11).

Among most active underlying, State Bank of India witnessed an addition of 1.10 million units of Open Interest in the June month futures contract, followed by Reliance Industries witnessing an addition of 0.11 million units of Open Interest in the June month contract, Maruti Suzuki India witnessed an addition of 0.003 million units of Open Interest in the June month contract, ICICI Bank witnessed an addition of 0.85 million units of Open Interest in the June month contract and Yes Bank witnessed a contraction of 4.63 million units of Open Interest in the June month future contract.