Nifty resumes northward journey on Tuesday

Nifty resumes its northward journey on Tuesday and ended the day’s trade with gains above a percent. Market made a cautious start, as exporters expressed concerns over rising freight charges and shortage of containers as it would impact the country's outbound shipments, and sought Commerce Ministry's intervention in the matter. But, soon index held the grip to trade in green territory with British drug maker AstraZeneca Plc stating that the Covid-19 vaccine being developed by the University of Oxford produced an immune response in both elderly and young people and adverse reactions were lower among the elderly. Some support also come with a report that it could be a healthy sign of economic recovery, goods and services tax (GST) collections recorded in the month of October are likely to cross Rs 1 lakh crore for the first time this fiscal. Market continued buying activity to touch its intraday high point in last leg of trade after rating agency CRISIL has said that over 40% of banking system credit and 75% of borrowers are likely to benefit from interest-on-interest concession granted by the federal government. The move is expected to cost the exchequer Rs 7500 crore. Finally, Nifty ended the session above its 11850 mark.

Most of the sectoral indices ended in green except IT, PSU Bank and Realty. The top gainers from the F&O segment were ACC, MRF and Kotak Mahindra Bank. On the other hand, the top losers were PVR, SAIL and Mahindra & Mahindra Financial Services. In the index option segment, maximum OI continues to be seen in the 11,500 - 12,700 calls and 10,900 - 11,500 puts indicating this is the trading range expectation.

India Volatility Index (VIX), a gauge for market’s short term expectation of volatility decreased by 2.79% and reached 22.20.The 50 share Nifty up by 121.65 points or 1.03% to settle at 11,889.40.

Nifty October 2020 futures closed at 11875.00 (LTP) on Tuesday, at a discount of 14.40 points over spot closing of 11889.40, while Nifty November 2020 futures ended at 11884.10 (LTP), at a discount of 5.30 points over spot closing.  Nifty October futures saw a contraction of 480 units, taking the total open interest (OI) to 1,20,524. The near month derivatives contract will expire on October 29, 2020 (Provisional).

From the most active contracts, Kotak Mahindra Bank October 2020 futures traded at a discount of 6.70 points at 1576.00 (LTP) compared with spot closing of 1582.70. The numbers of contracts traded were 87,670 (Provisional).

Reliance Industries October 2020 futures traded at a premium of 5.60 points at 2040.00 (LTP) compared with spot closing of 2034.40. The numbers of contracts traded were 50,294 (Provisional).

ICICI Bank October 2020 futures traded at a discount of 0.35 points at 409.95 (LTP) compared with spot closing of 410.30. The numbers of contracts traded were 49,983 (Provisional).

HDFC Bank October 2020 futures traded at a discount of 1.55 points at 1233.45 (LTP) compared with spot closing of 1235.00. The numbers of contracts traded were 38,393 (Provisional).

Axis Bank October 2020 futures traded at a premium of 0.65 points at 507.85 (LTP) compared with spot closing of 507.20. The numbers of contracts traded were 37,313 (Provisional).

Among, Nifty calls, 12000 SP from the October month expiry was the most active call with a contraction of 8,658 units open interests. Among Nifty puts, 11800 SP from the October month expiry was the most active put with an addition of 15,827 units open interests. The maximum OI outstanding for Calls was at 12000 SP (61,277 units) and that for Puts was at 11000 SP (56,980 units). The respective Support and Resistance levels of Nifty are: Resistance 11,951.30 -- Pivot Point 11,837.15 -- Support -- 11,775.25.

The Nifty Put Call Ratio (PCR) finally stood at (1.16) for October month contract. The top five scrips with highest PCR on Kotak Mahindra Bank (1.45), MRF (1.40), Apollo Tyers (1.28), Shriram Transport Finance Company (1.11) and ACC (1.03).

Among most active underlying, Kotak Mahindra Bank witnessed an addition of 6,145 units of Open Interest in the October month futures contract followed by Reliance Industries witnessed an addition of 4,867 units of Open Interest in the October month futures contract, Bajaj Finance witnessed a contraction of 488  units of Open Interest in the October month futures contract, ICICI Bank witnessed an addition of 14,175 units of Open Interest in the October month futures contract and HDFC witnessed an addition of 10,964 units of Open Interest in the October month futures contract (Provisional).