Nifty ends lower as crude price surges

17 Sep 2019 Evaluate

Extending the bearish trend for second straight session, NSE gauge -- Nifty50 -- ended Tuesday’s trade below its crucial 10,850 level, on fear that surge in crude prices following attacks on Saudi oil facilities could hurt the economy further. Market made a cautious start and continued to hit new lower level on every interval, as traders remain concerned with a private report indicating that lose-monetary policy alone cannot arrest the deepening slump, instead government must take demand-boosting measures, especially in rural areas, by frontloading expenditure primarily through the national rural employment scheme. It also warned that any attempt to trim government spending to maintain the fiscal numbers will be severely detrimental to growth. Further, the street got worried with India Ratings and Research’s (Ind-Ra) report stating that the recent set of measures to stimulate growth announced last week would yield only limited short-term benefits. It also said that the weakness in the economy has largely been caused by demand-side headwinds, which have been exacerbated by structural bottle-necks.

However, market declined further in the last leg of the trade to end the day’s session with losses by over one and half percent as domestic sentiments got hit with the report that investments through participatory notes (P-notes) in the Indian capital market stood at Rs 79,088 crore in August-end, registering the third consecutive month-on-month decline. Market moved deeper into the red during end of the day as weakness in the rupee against the US dollar rattled investor sentiment.

All the NSE sectoral indices ended in red. The top gainers from the F&O segment Arvind, GAIL (India) and Godrej Consumer Products. On the other hand, the top losers were Dish TV India, Power Finance Corporation and NCC. In the index option segment, maximum OI continues to be seen in the 10,800 - 11,300 calls and 10,700 - 10,900 puts indicating this is the trading range expectation.

India Volatility Index (VIX), a gauge for market’s short term expectation of volatility increased by 7.12% and reached 16.01.The 50 share Nifty was down by 185.90 points or 1.69% to settle at 10,817.60.

Among, Nifty calls, 11,000 SP from the September month expiry was the most active call with an addition of 1.27 million open interests. Among Nifty puts, 10,800 from the September month expiry was the most active put with a contraction of 0.81 million open interests. The maximum OI outstanding for Calls was at 11,200 SP (3.53 mn) and that for Puts was at 10,800 SP (3.84 mn). The respective Support and Resistance levels of Nifty are: Resistance 10,946.30 ---- Pivot Point 10,871.40 --- Support --- 10,742.70.

The Nifty Put Call Ratio (PCR) finally stood at 0.99 for September month contract. The top five scrips with highest PCR on Ramco Cements (2.12), Godrej Consumer Products (1.41), Muthoot Finance (1.38),Shree Cement (1.29) and Infosys (1.16).

Among most active underlying, State Bank of India witnessed an addition of 2.37 million units of Open Interest in the September month futures contract, followed by Axis Bank witnessing an addition of 4.20 million units of Open Interest in the September month contract, Housing Development Finance Corporation witnessed an addition of 2.38 million units of Open Interest in the September month contract, Maruti Suzuki India witnessed an addition of 0.09 million units of Open Interest in the September month contract and Reliance Industries witnessed an addition of 4.02 million units of Open Interest in the September month future contract.

Nifty ends lower as crude price surges

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