After seesawing between the green and red territory, NSE gauge -- Nifty50 snapped Friday’s trade in positive terrain with marginal gains. Market made a positive start, as traders took some support with the finance ministry stating that public sector banks (PSBs) have extended support of Rs 2.56 lakh crore to NBFCs by way of credit and pooled buyout since September 2018 as part of efforts to provide much-needed liquidity to the sector. But market failed to hold its gains for long time and turned volatile, as sentiments turned pessimistic with the government data showing that output of core infrastructure industries shrank by 5.2% in September 2019 as seven of eight sectors witnessed negative growth. The eight core sectors had expanded by 4.3% in September 2018. During the April-September period, the growth of core industries fell to 1.3% against 5.5% in the year-ago period. Adding some concern, the fiscal deficit stood at Rs 6.52 lakh crore till September-end 2019, compared to Rs 5.95 lakh crore in the same period of the previous fiscal year. Low revenue collections have become a reason to worry about the fiscal deficit.
Market continued its volatile trade, as traders took note of a report that year-on-year growth in the Centre’s total budgetary expenditure rose from (-) 11% in June to 34% in September; spending grew 28% in Q2, against just 2% in Q1. The mood on the street remained cautious with monthly survey showing that manufacturing activity in the country continued to weaken in October, with factory orders and production rising at the weakest rates in two years. The headline seasonally adjusted IHS Markit India Manufacturing Purchasing Managers' Index (PMI) fell to a two-year low of 50.6 in October from 51.4 in September. However, in the last leg of the trade, the Nifty managed to trim its losses, as traders took some solace with State Bank of India’s report that credit growth in the system has picked up rapid pace beginning September 2019 after lagging behind for several months in a row, on the back of demand from housing, non-banking financial companies (NBFC) and micro, small and medium enterprises (MSME) sectors.
Most of the NSE sectoral indices ended in green, except Auto and IT. The top gainers from the F&O segment Dish TV India and Zee Entertainment Enterprises and Vodafone Idea. On the other hand, the top losers were Yes Bank, Just Dial and Tata Global Beverages. In the index option segment, maximum OI continues to be seen in the 11800- 12,200 calls and 11,400 -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 3.36% and reached 15.73.The 50 share Nifty was up by 13.15 points or 0.11% to settle at 11,890.60.
Nifty November 2019 futures closed at 11936.15 (LTP) on Friday, at a premium of 45.55 points over spot closing of 11890.60, while Nifty December 2019 futures ended at 11980.00 (LTP), at a premium of 89.40 points over spot closing. Nifty November futures saw an addition of 0.49 million (mn) units, taking the total outstanding open interest (OI) to 14.80 mn units. The near month derivatives contract will expire on November 28, 2019 (Provisional).
From the most active contracts, Yes Bank November 2019 futures traded flat 66.10 (LTP) with spot closing of 66.10. The numbers of contracts traded were 1,06,665 (Provisional).
Zee Entertainment Enterprises November 2019 futures traded at a discount of 0.45 points at 308.25 (LTP) compared with spot closing of 308.70. The numbers of contracts traded were 45,715 (Provisional).
Indiabulls Housing Finance November 2019 futures traded at a discount of 5.95 points at 210.00 (LTP) compared with spot closing of 215.95. The numbers of contracts traded were 41,825 (Provisional).
State Bank of India November 2019 futures traded at a premium of 0.50 points at 314.10 (LTP) compared with spot closing of 313.60. The numbers of contracts traded were 26,913 (Provisional).
Tata Steel November 2019 futures traded at a premium of 1.00 points at 397.45 (LTP) compared with spot closing of 396.45. The numbers of contracts traded were 26,714 (Provisional).
Among, Nifty calls, 12000 SP from the November month expiry was the most active call with an addition of 0.19 million open interests. Among Nifty puts, 11,800 from the November month expiry was the most active put with an addition of 0.24 million open interests. The maximum OI outstanding for Calls was at 12000 SP (1.79 mn) and that for Puts was at 11,600 SP (1.88 mn). The respective Support and Resistance levels of Nifty are: Resistance 11,924.82 -- Pivot Point 11,884.08 -- Support -- 11,849.87.
The Nifty Put Call Ratio (PCR) finally stood at 1.20 for November month contract. The top five scrips with highest PCR on Bosch (1.86), Oil India (1.73), Cummins India (1.52), Mahindra & Mahindra Fin. Services (1.42) and Hindustan Unilever (1.39).
Among most active underlying, State Bank of India witnessed an addition of 3.84 million units of Open Interest in the November month futures contract, followed by Reliance Industries witnessing an addition of 0.33 million units of Open Interest in the November month contract, Yes Bank witnessed an addition of 8.06 million units of Open Interest in the November month contract, Dr. Reddy's Laboratories witnessed an addition of 0.46 million units of Open Interest in the November month contract and Bajaj Finance witnessed an addition of 0.25 million units of Open Interest in the November month future contract (Provisional).
