Indian benchmark -- Nifty -- finished the session in red territory, as traders opted to book profit after yesterday’s huge rally on account of weak macro-economic data. India's retail inflation based on Consumer Price Index (CPI) spiked to 7.59 per cent for the month of January 2020 from 7.35 per cent in December 2019, due to costlier food products like vegetables, pulses and protein-rich items. Inflation in January is well above the Reserve Bank of India's (RBI) medium-term target of 4 per cent for the fourth straight month. Market made a cautious start, as sentiments remain dampened with Industrial production contracted by 0.3 per cent in December 2019 as against 2.5 per cent growth in same month a year ago, weighed by a decline in the manufacturing sector. Soon, market started decline and entered into red zone, as traders were cautious with Finance Minister Nirmala Sitharaman’s statement that Goods and Services Tax (GST) compensation to states is delayed due to inadequate realisation of cess and that the Centre was not according any differential treatment to states.
Market extended its downside till the end of session, as traders failed to get some relief with Chief Economic Advisor Krishnamurthy Subramanian’s statement that the coronavirus outbreak in China provides an opportunity for India to expand exports. India is one of China's leading trade partners in Asia and has a huge trade deficit with that country. Traders also shrugged off Union Minister Nitin Gadkari’s statement that the government is targeting khadi and village industries to boost job creation in the rural and tribal areas and improve purchasing power of people. Finally, Nifty ended the lethargic day of trade below its crucial 12150 mark.
Traders were seen piling up positions in FMCG, IT and Media, while selling was witnessed in Bank, Auto and Financial service. The top gainers from the F&O segment were Torrent Power, Yes Bank and GMR Infrastructure. On the other hand, the top losers were Indraprastha Gas, NMDC and IndusInd Bank 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 1.85% and reached 13.37. The 50 share Nifty down by 26.55 points or 0.22% to settle at 12,174.65.
Nifty February 2020 futures closed at 12163.15 (LTP) on Thursday, at a discount of 11.50 points over spot closing of 12174.65, while Nifty March 2020 futures ended at 12183.00 (LTP), at a premium of 8.35 points over spot closing. Nifty February futures saw an addition of 0.91 million (mn) units, taking the total outstanding open interest (OI) to 14.12 mn units. The near month derivatives contract will expire on February 27, 2020 (Provisional).
From the most active contracts, State Bank of India February 2020 futures traded at a premium of 1.00 points at 328.50 (LTP) compared with spot closing of 327.50. The numbers of contracts traded were 42,074 (Provisional).
Reliance Industries Limited February 2020 futures traded at a premium of 0.40 points at 1470.85 (LTP) compared with spot closing of 1470.45. The numbers of contracts traded were 20,666 (Provisional).
Indiabulls Housing Finance Limited February 2020 futures traded at a premium of 0.15 points at 326.25 (LTP) compared with spot closing of 326.10. The numbers of contracts traded were 18,744 (Provisional).
Indusind Bank Limited February 2020 futures traded at a premium of 0.65 points at 1232.50 (LTP) compared with spot closing of 1231.85. The numbers of contracts traded were 18,513 (Provisional).
ICICI Bank Limited February 2020 futures traded at a premium of 1.15 points at 541.20 (LTP) compared with spot closing of 540.05. The numbers of contracts traded were 14,792 (Provisional).
Among, Nifty calls, 12200 SP from the February month expiry was the most active call with an addition of 0.20 million open interests. Among Nifty puts, 12100 from the February month expiry was the most active put with an addition of 0.009 million open interests. The maximum OI outstanding for Calls was at 12500 SP (2.69 mn) and that for Puts was at 12000 SP (3.89 mn). The respective Support and Resistance levels of Nifty are: Resistance 12,220.27 -- Pivot Point 12,180.03 -- Support -- 12,134.42.
The Nifty Put Call Ratio (PCR) finally stood at 1.24 for February month contract. The top five scrips with highest PCR on Tata Chemicals (1.40), JSW Steel (1.33), Shriram Transport Finance Company (1.29), Bajaj Finance (1.28) and Hindustan Unilever (1.27).
Among most active underlying, State Bank Of India witnessed an addition of 0.46 million units of Open Interest in the February month futures contract, followed by Reliance Industries witnessing an addition of 0.74 million units of Open Interest in the February month contract, Icici Bank witnessed an addition of 1.49 million units of Open Interest in the February month contract, Bajaj Finance witnessed an addition of 0.20 million units of Open Interest in the February month contract and Titan Company witnessed an addition of 0.49 million units of Open Interest in the February month future contract (Provisional).
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