Nifty ends volatile session in red terrain

S&P CNX Nifty ended Friday’s trading session below its crucial 11,100 level. Market made a cautious start but managed to trade with marginal gains in early morning deals, as traders took support with Commerce and Industry Minister Piyush Goyal statement that the government is working on production-linked incentives for 12 major sectors like Active Pharmaceutical Ingredients and electronics. However, market failed to protect gains further during the day and started trading near neutral line in negative territory, as Reserve Bank of India is likely to leave repo rate unchanged in the upcoming policy review meeting and the Monetary Policy Committee may look for 'unconventional policy measures' to ensure financial stability. Traders shrugged off India Ratings and Research’s (Ind-Ra) latest report stating that Indian energy demand is showing signs of recovery as the decline in power demand narrowed in June 2020 as compared to May and April which was down 14.9 percent and 22.3 percent, respectively, due to the gradual lifting of lockdown for certain economic activities and an increase in domestic consumption with the extended summer season.

Traders were seen piling up positions in Pharma, PSU Bank and Realty, while selling was witnessed in Media, Fin Service and Pvt Bank. The top gainers from the F&O segment were Torrent Pharmaceuticals, Piramal Enterprises and Godrej Properties. On the other hand, the top losers were Cholamandalam Investment and Finance Company, Indiabulls Housing Finance and Hindustan Petroleum Corporation. In the index option segment, maximum OI continues to be seen in the 11,300 - 11,600 calls and 10900 - 11100 puts indicating this is the trading range expectation.

India Volatility Index (VIX), a gauge for market’s short term expectation of volatility decreased by 0.54 and reached 24.19. The 50 share Nifty down by 28.70 points or 0.26% to settle at 11,073.45.

Nifty August 2020 futures closed at 11104.95 (LTP) on Friday, at a premium of 31.50 points over spot closing of 11073.45, while Nifty September 2020 futures ended at 11109.90 (LTP), at a premium of 36.45 points over spot closing. Nifty August futures saw an addition of 0.36 million (mn) units, taking the total outstanding open interest (OI) to 10.77 mn units. The near month derivatives contract will expire on August 27, 2020 (Provisional).

From the most active contracts, Reliance Industries August 2020 futures traded at a premium of 11.50 points at 2081.50 (LTP) compared with spot closing of 2070.00. The numbers of contracts traded were 80,157 (Provisional).

SBIN August 2020 futures traded at a premium of 0.80 points at 191.85 (LTP) compared with spot closing of 191.05. The numbers of contracts traded were 79,875 (Provisional).

Sun Pharmaceutical Industries August 2020 futures traded at a discount of 1.95 points at 535.85 (LTP) compared with spot closing of 537.80. The numbers of contracts traded were 47,130 (Provisional).

HDFC Bank August 2020 futures traded at a premium of 3.20 points at 1036.45 (LTP) compared with spot closing of 1033.25. The numbers of contracts traded were 34,850 (Provisional).

ICICI Bank August 2020 futures traded at a premium of 1.55 points at 348.75 (LTP) compared with spot closing of 347.20. The numbers of contracts traded were 34,458 (Provisional). 

Among, Nifty calls, 11500 SP from the August month expiry was the most active call with an addition of 0.20 million open interests. Among Nifty puts, 11000 SP from the August month expiry was the most active put with an addition of 0.26 million open interests. The maximum OI outstanding for Calls was at 11500 SP (2.00 mn) and that for Puts was at 11000 SP (3.36 mn). The respective Support and Resistance levels of Nifty are: Resistance 11,140.35 -- Pivot Point 11,083.50 -- Support -- 11,016.60.

The Nifty Put Call Ratio (PCR) finally stood at (1.68) for August month contract. The top five scrips with highest PCR on Exide Industries (1.66), Ramco Cements (1.32), Container Corporation of India (1.20), Pidilite Industries (1.10) and Vedanta (1.03).

Among most active underlying, Reliance Industries witnessed an addition of 5.23 million units of Open Interest in the August month futures contract, followed by State Bank of India witnessing an addition of 12.05 million units of Open Interest in the August month contract, Sun Pharmaceutical Industries witnessed an addition of 3.82 million units of Open Interest in the August month contract, Bajaj Finance witnessed a contraction of 0.25 million units of Open Interest in the August month contract and Infosys witnessed an addition of 0.59 million units of Open Interest in the August month future contract (Provisional).