Nifty continues bull run for fourth straight session

Rising for the fourth straight session, key equity benchmark --Nifty-- closed the session above the psychological 12100 level on Thursday. The day began on a positive note with a private report that India can achieve the target, to become a $5 trillion economy by 2025, by using automation technologies such as, artificial intelligence, natural language processing and machine learning that will drive increased efficiencies and new jobs resulting in economic growth in the next few years. However, market started declining in early noon session to touch intraday low point, as some anxiety spread among the investors with NITI Aayog member Ramesh Chand’s statement that Indian agriculture sector is facing issues in making available customised technology to farmers and implementation of policy reforms, especially at the state level.

Afterwards, market started trading higher, as Reserve Bank of India (RBI), for the second straight time, kept its key policy rate unchanged at 5.15 percent, maintaining its accommodative policy stance as long as it was necessary to revive growth. Moreover, the RBI also pegged the GDP growth for the financial year 2020-21 (FY21) at 6 percent and in the range of 5.5-6.0 percent in the first half of the next fiscal. Market ended the day’s trade in green territory taking support with Prime Minister Narendra Modi’s statement that the India is eyeing defence export of $5 billion in the next five years, highlighting the measures taken by his government to boost manufacturing and woo investors to set up a base in the country.

Most of the NSE sectoral indices ended in green, except  FMGC, IT and Realty. The top gainers from the F&O segment Indiabulls Housing Finance, L&T Finance Holdings and LIC Housing Finance. On the other hand, the top losers were Jubilant Foodworks, Torrent Power and DLF. In the index option segment, maximum OI continues to be seen in the 12000 -12,700 calls and 11,900 - 12,350 puts indicating this is the trading range expectation.

India Volatility Index (VIX), a gauge for market’s short term expectation of volatility decreased by 2.77% and reached 13.78. The 50 share Nifty was up by 48.80 points or 0.40% to settle at 12,137.95.

Nifty February 2020 futures closed at 12131.20 (LTP) on Thursday, at a discount of 6.75 points over spot closing of 12137.95, while Nifty March 2020 futures ended at 12156.00 (LTP), at a premium of 18.05 points over spot closing. Nifty February futures saw an addition of 1.45 million (mn) units, taking the total outstanding open interest (OI) to 15.24 mn units. The near month derivatives contract will expire on February 27, 2020 (Provisional).

From the most active contracts, Indiabulls Housing Finance February 2020 futures traded at a discount of  5.75 points at 314.00 (LTP) compared with spot closing of 319.75. The numbers of contracts traded were 82,665 (Provisional).

State Bank of India February 2020 futures traded at a premium of 0.65 points at 321.70 (LTP) compared with spot closing of 321.05. The numbers of contracts traded were 41,774 (Provisional).

Indusind Bank February 2020 futures traded at a premium of 0.60 points at 1331.60 (LTP) compared with spot closing of 1331.00. The numbers of contracts traded were 30,298 (Provisional).

Reliance Industries February 2020 futures traded at a discount of 1.05 points at 1453.95 (LTP) compared with spot closing of 1455.00. The numbers of contracts traded were 24,466 (Provisional).

ICICI Bank February 2020 futures traded at a premium of 1.10 points at 542.20 (LTP) compared with spot closing of 541.10. The numbers of contracts traded were 22,508 (Provisional).

Among, Nifty calls, 12200 SP from the February month expiry was the most active call with an addition of 0.14 million open interests. Among Nifty puts, 12000 from the February month expiry was the most active put with an addition of 0.57 million open interests. The maximum OI outstanding for Calls was at 12500 SP (2.40 mn) and that for Puts was at 12000 SP (3.42 mn). The respective Support and Resistance levels of Nifty are: Resistance 12,170.82 -- Pivot Point 12,127.73 -- Support -- 12,094.87.

The Nifty Put Call Ratio (PCR) finally stood at 1.25 for February month contract. The top five scrips with highest PCR on Tata Chemicals (1.63), Power Finance Corporation (1.23), Shriram Transport Finance Company (1.19), Bajaj Finance (1.13) and Lupin (1.12).

Among most active underlying, State Bank Of India witnessed a contraction of 0.21 million units of Open Interest in the February month futures contract, followed by Indiabulls Housing Finance witnessing an addition of 3.67 million units of Open Interest in the February month contract, Bajaj Finance witnessed an addition of 0.52 million units of Open Interest in the February month contract, Reliance Industries witnessed an addition of 0.71 million units of Open Interest in the February month contract and Bharti Airtel witnessed an addition of 2.47 million units of Open Interest in the February month future contract (Provisional).