Nifty ends in red after continuing 4 day’s gaining rally

Snapping its 4-day gaining streak, the local benchmark -- Nifty -- ended the session with cut of over one third a percent on Friday. Market made cautious start, as traders were cautions with ICRA’s report that weak consumer sentiment, the slowdown in the infrastructure sector, and benign commodity prices have negatively impacted the performance of companies in Q3FY20. Market continued its southward journey throughout the day, as investors’ sentiment remain dented with RBI’s Consumer Confidence Survey stating that the consumer confidence dropped further in January 2020 as against the last round. However, it said the future expectations index remained positive, implying an improvement in the last survey. Further, index extended its losses with report that the RBI projected the economy to expand by 6% during the next financial year, pegging it at the lower end of the GDP growth estimate of the Economic Survey. Traders paid no heed towards RBI Governor Shaktikanta Das’ statement that the Rs 1-lakh-crore of long-term repos are aimed at helping banks lower their lending rates, thus quickening the monetary policy transmission.

Traders were seen piling up positions in FMGC, IT and Media, while selling was witnessed in Bank, Auto and Financial services. The top gainers from the F&O segment were Aurobindo Pharma, Zee Entertainment Enterprises and Biocon. On the other hand, the top losers were DLF, NCC and Motherson Sumi Systems. 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 0.24% and reached 13.74. The 50 share Nifty down by 39.60 points or 0.33% to settle at 12,098.35.

Nifty February 2020 futures closed at 12083.25 (LTP) on Friday, at a discount of 15.10 points over spot closing of 12098.35, while Nifty March 2020 futures ended at 12105.80 (LTP), at a premium of 7.45 points over spot closing. Nifty February futures saw an addition of 0.59 million (mn) units, taking the total outstanding open interest (OI) to 14.34 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 6.20 points at 313.40 (LTP) compared with spot closing of 319.60. The numbers of contracts traded were 32,692 (Provisional).

State Bank of India February 2020 futures traded at a premium of 1.05 points at 320.85 (LTP) compared with spot closing of 319.80. The numbers of contracts traded were 26,910 (Provisional).

Aurobindo Pharma February 2020 futures traded at a premium of 0.55 points at 543.35 (LTP) compared with spot closing of 542.80. The numbers of contracts traded were 24,481 (Provisional).

Reliance Industries February 2020 futures traded at a premium of 3.35 points at 1435.35 (LTP) compared with spot closing of 1432.00. The numbers of contracts traded were 19,240 (Provisional).

Hero Motocorp February 2020 futures traded at a discount of 58.10 points at 2381.95 (LTP) compared with spot closing of 2440.05. The numbers of contracts traded were 18,514 (Provisional).

Among, Nifty calls, 12100 SP from the February month expiry was the most active call with an addition of 0.004 million open interests. Among Nifty puts, 12000 from the February month expiry was the most active put with an addition of 0.004 million open interests. The maximum OI outstanding for Calls was at 12500 SP (2.67 mn) and that for Puts was at 12000 SP (3.19 mn). The respective Support and Resistance levels of Nifty are: Resistance 12,144.05 -- Pivot Point 12,109.00 -- Support -- 12,063.30

The Nifty Put Call Ratio (PCR) finally stood at 1.21 for February month contract. The top five scrips with highest PCR on Tata Chemicals (1.49), Power Finance Corporation (1.26), Shriram Transport Finance Company (1.18), Bajaj Finance (1.17) and SRF (1.12).

Among most active underlying, State Bank Of India witnessed an addition of 2.76 million units of Open Interest in the February month futures contract, followed by Reliance Industries witnessing an addition of 1.13 million units of Open Interest in the February month contract, Aurobindo Pharma witnessed an addition of 0.70 million units of Open Interest in the February month contract, Bajaj Finance witnessed an addition of 0.01 million units of Open Interest in the February month contract and Axis Bank witnessed an addition of 1.00 million units of Open Interest in the February month future contract (Provisional).