Intense selling drags Nifty below 14700 mark

CNX S&P --Nifty-- witnessed sharp sell-off in Monday’s trade and ended the day’s trade with the cut of above two percent. Market made a cautious start, after Maharashtra Chief Minister Uddhav Thackeray said that a strict lockdown could be implemented in the state and Mumbai if people don't follow discipline. Thackeray said that imposing a lockdown is necessary to cut the chain of the COVID-19 infection and added that districts have been told to impose restrictions as required from February 22.  Further, market extended its losses with reports that ahead of its 'Bharat Bandh' call on February 26, traders' body CAIT wrote to Prime Minister Narendra Modi raising issues related to the GST regime, and alleging violation of e-commerce rules by major e-tailers. In its letter to the prime minister, the Confederation of All India Traders (CAIT) called for setting up of a ‘special working group’ at the central level comprising senior officials, CAIT representatives and independent tax experts to review the GST structure and make recommendations to the government. Heavy selling pressure over the last one hour of trade dragged the market below 14700 mark

Most of the sectoral indices ended in red except Metal. The top gainers from the F&O segment were Vedanta, Jubilant FoodWorks and Torrent Power. On the other hand, the top losers were REC, PVR and Godrej Properties. In the index option segment, maximum OI continues to be seen in the 14100 - 16200 calls and 13,700 - 14,500 puts indicating this is the trading range expectation.

India Volatility Index (VIX), a gauge for market’s short term expectation of volatility increased by 14.47% and reached 25.47. The 50 share Nifty down by 306.05 points or 2.04% to settle at 14,675.70.

Nifty February 2021 futures closed at 14642.55 (LTP) on Monday, at a discount of 33.15 points over spot closing of 14675.70, while Nifty March 2021 futures ended at 14689.45 (LTP), at a premium of 13.75 points over spot closing.  Nifty February futures saw a contraction of 10,192 units, taking the total open interest (OI) to 1,31,680 units. The near month derivatives contract will expire on February 25, 2021 (Provisional).

From the most active contracts, Reliance Industries February 2021 futures traded at a discount of 1.20 points at 1998.90 (LTP) compared with spot closing of 2000.10. The numbers of contracts traded were 71,334 (Provisional).

ICICI Bank February 2021 futures traded at a premium of 1.85 points at 610.50 (LTP) compared with spot closing of 608.65. The numbers of contracts traded were 37,862 (Provisional).

HDFC Bank February 2021 futures traded flat with spot closing of 1540.00. The numbers of contracts traded were 30,041 (Provisional).

SBIN February 2021 futures traded at a premium of 1.20 points at 389.50 (LTP) compared with spot closing of 388.30. The numbers of contracts traded were 29,400 (Provisional).

Infosys February 2021 futures traded at a premium of 1.40 points at 1265.20 (LTP) compared with spot closing of 1263.80. The numbers of contracts traded were 24,034 (Provisional).

Among, Nifty calls, 15000 SP from the February month expiry was the most active call with an addition of 38,302 units open interests. Among Nifty puts, 14700 SP from the February month expiry was the most active put with an addition of 9,351 units open interests. The maximum OI outstanding for Calls was at 16000 SP (61,649 units) and that for Puts was at 14000 SP (65,034 units). The respective Support and Resistance levels of Nifty are: Resistance 14,912.18 -- Pivot Point 14,773.62 -- Support -- 14,537.13.

The Nifty Put Call Ratio (PCR) finally stood at (0.70) for February month contract. The top five scrips with highest PCR on Vedanta (1.13), IDFC First Bank (1.00), Jubilant FoodWorks (0.95), Shree Cement (0.91) and  Grasim Industries (0.91).

Among most active underlying, Reliance Industries witnessed an addition of 9,389 units of Open Interest in the February month futures contract followed by SBIN witnessed an addition of 565 units of Open Interest in the February month futures contract, ICICI Bank witnessed an addition of 7,359 units of Open Interest in the February month futures contract, Bajaj Finance witnessed an addition of 208 units of Open Interest in the February month futures contract and HDFC Bank witnessed an addition of 6,213 units of Open Interest in the February month futures contract (Provisional).