Nifty ends volatile day with half a percent gains

NSE gauge -- Nifty50 -- ended the volatile session in green with a gain of around half a percent on Wednesday as traders took some encouragement with report that India's central bank recommended a slew of measures for developing a secondary market for corporate loans, including easing of regulations to allow foreign portfolio investors (FPIs) to directly purchase distressed loans from banks. Market traded cautiously for most part of the day as traders remain concerned with Care Ratings’ report that the ongoing economic slowdown that India is witnessing may be because of weak investment growth. Two catalysts of investment - demand and availability of funds - have witnessed weak growth in the preceding months. The street also got worried as country's services sector activity growth eased in August as new business inflows rose at a slower pace; following which job creation and output expansion moderated. The IHS Markit India Services Business Activity Index declined from 53.8 in July to 52.4 in August, pointing to a slower rate of increase in output.

However, key index got some momentum and gained traction in later part of trade to end near its crucial 10,850 as traders took some support with report that the Board of Trade (BoT) will seek views of various stakeholders such as government departments, states, exporters and industry members on September 12 on ways to boost exports of goods and services. Traders also took encouragement with SME Minister Nitin Gadkari has called a meeting of heads of banks, finance ministry officials, and CEOs of various of central PSUs on September 5 to sort out the problem of delayed payments being faced by small and medium enterprises.

Traders were seen piling up positions in Bank, Metal and Financial services, while selling was witnessed in FMCG, Media and Pharma. The top gainers from the F&O segment were Steel Authority of India, Bharat Electronics and Mahindra & Mahindra Financial Services. On the other hand, the top losers were Escorts, IDBI Bank and Maruti Suzuki India. In the index option segment, maximum OI continues to be seen in the 11,100 - 11,300 calls and 10,700- 11,900 puts indicating this is the trading range expectation.

India Volatility Index (VIX), a gauge for market’s short term expectation of volatility decreased by 4.54% and reached 17.23.The 50 share Nifty was up by 46.75 points or 0.43% to settle at 10,844.65.

Among, Nifty calls, 11,000 SP from the September month expiry was the most active call with an addition of 0.23 million open interests. Among Nifty puts, 10,800 from the September month expiry was the most active put with an addition of 0.16 million open interests. The maximum OI outstanding for Calls was at 11,200 SP (2.48 mn) and that for Puts was at 10,800 SP (2.99 mn). The respective Support and Resistance levels of Nifty are: Resistance  10,886.82--Pivot Point  10,816.58--Support--10,774.42. 

The Nifty Put Call Ratio (PCR) finally stood at 1.10 for September month contract. The top five scrips with highest PCR on Bosch (8.00), Shree Cement (7.00),Ramco Cements (4.14), Cummins India (1.78) and Tata Motors - DVR Ordinary (1.49).

Among most active underlying, Reliance Industries witnessed an addition of 4.27 million units of Open Interest in the September month futures contract, followed by State Bank of India witnessing an addition of 1.34 million units of Open Interest in the September month contract, Sun Pharmaceutical Industries witnessed an addition of 1.87 million units of Open Interest in the September month contract, HDFC Bank witnessed an addition of 0.26 million units of Open Interest in the September month contract and Maruti Suzuki India witnessed an addition of 0.43 million units of Open Interest in the September month future contract.