Indian equity index--Nifty--ended in red for fifth straight session with cut of over a percent, as the Reserve Bank of India (RBI) reduced GDP growth forecast to 6.1 percent from its earlier estimate of 6.9 per cent in its fourth bi-monthly monetary policy meeting. Market made a positive start and traded in fine fettle, as traders took encouragement with Aayog CEO Amitabh Kant’s statement that there will be many more structural reforms by the government in the coming days to push economy to a high growth trajectory. He added that the government announced a series of economic boosters including capitalisation of public sector banks, merging some of them, package for exports, and bringing down corporate tax rate. Some support also came with a report that Commerce and Industry Minister Piyush Goyal and US Secretary for Commerce Wilbur Ross held discussions to increase bilateral trade between the countries.
However, barometer erased all of its gains to turn negative in second half of the day, as monthly survey showed that the country’s services sector activity contracted in September and fell to its lowest level since February 2018, amid weak demand, competitive pressures and challenging market conditions. The IHS Markit India Services Business Activity Index fell to 48.7 in September from 52.4 in August, as lackluster client demand weighed on the performance of the Indian service economy. Market participants failed to take any sense of relief with report that Monetary Policy Committee (MPC) of the Reserve Bank of India slashed the short-term lending rate, repo rate, by 25 basis points in its fourth bimonthly policy review.
Most of the NSE sectoral indices ended in red, except IT. The top gainers from the F&O segment IDFC First Bank, Torrent Pharmaceuticals and Apollo Hospitals Enterprise. On the other hand, the top losers were Indiabulls Housing Finance, Just Dial and Zee Entertainment Enterprises. In the index option segment, maximum OI continues to be seen in the 11400 -11,800 calls and 10,700 -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 0.69% and reached 17.58.The 50 share Nifty was down by 139.25 points or 1.23% to settle at 11,174.75.
Nifty October 2019 futures closed at 11201.20 (LTP) on Friday, at a premium of 26.45 points over spot closing of 11174.75, while Nifty November 2019 futures ended at 11250.00 (LTP), at a premium of 75.25 points over spot closing (Provisional).Nifty October futures saw an addition of 0.33 million (mn) units, taking the total outstanding open interest (OI) to 16.16 mn units. The near month derivatives contract will expire on October 31, 2019 (Provisional).
From the most active contracts, Yes Bank October 2019 futures traded at a premium of 0.10 points at 42.00 (LTP) compared with spot closing of 41.90. The numbers of contracts traded were 1,04,774 (Provisional).
State Bank of India October 2019 futures traded at a premium of 0.60 points at 250.25 (LTP) compared with spot closing of 249.65. The numbers of contracts traded were 41,299 (Provisional).
Indiabulls Housing Finance October 2019 futures traded at a discount of 10.65 points at 233.85 (LTP) compared with spot closing of 244.50. The numbers of contracts traded were 29,428 (Provisional).
HDFC Bank October 2019 futures traded at a premium of 7.20 points at 1196.95 (LTP) compared with spot closing of 1189.75. The numbers of contracts traded were 28,728 (Provisional).
ICICI Bank October 2019 futures traded at a premium of 1.80 points at 414.90 (LTP) compared with spot closing of 413.10. The numbers of contracts traded were 25,895 (Provisional).
Among, Nifty calls, 11,500 SP from the October month expiry was the most active call with an addition of 0.44 million open interests. Among Nifty puts, 11,000 from the October month expiry was the most active put with a contraction of 0.22 million open interests. The maximum OI outstanding for Calls was at 11,500 SP (2.67 mn) and that for Puts was at 11,000 SP (2.44 mn). The respective Support and Resistance levels of Nifty are: Resistance 11,330.58 --Pivot Point 11,244.47 -- Support -- 11,088.63.
The Nifty Put Call Ratio (PCR) finally stood at 0.86 for October month contract. The top five scrips with highest PCR on Bosch (14.00), Cummins India (2.28), MRF (2.00), Torrent Pharmaceuticals (1.07) and Mahindra & Mahindra Fin Services (1.05).
Among most active underlying, State Bank of India witnessed an addition of 9.44 million units of Open Interest in the October month futures contract, followed by Housing Development Finance Corporation witnessing a contraction of 1.00 million units of Open Interest in the October month contract, Reliance Industries witnessed an addition of 0.20 million units of Open Interest in the October month contract, HDFC Bank witnessed an addition of 0.09 million units of Open Interest in the October month contract and Bharat Petroleum Corporation witnessed an addition of 2.17 million units of Open Interest in the October month future contract (Provisional).
