Nifty falls like house of card; loses 5% on Thursday

Nifty witnessed worst fall in two years on Thursday after Russia's invasion of Ukraine sent oil prices soaring and fanned inflation fears. The overall market breadth was negative as all 50 shares declined on the Nifty. All of the 15 sector gauges compiled by the NSE settled in the red. Market made negative start, as the price of oil crossed $100 per barrel mark stoking inflation fears in oil importing countries like India. Further, index continued its weak trade after India Ratings revised downwards its GDP growth forecast for 2021-22 to 8.6 per cent from the consensus 9.2 per cent projected earlier. Traders paid no heed towards Moody’s Investors Service raised India's growth forecast to 9.5 per cent for the calendar year 2022 and to 8.4 per cent for the coming fiscal beginning April 1, even as it flagged high oil prices and supply distortions as a drag on growth.

In last leg of trade, market added more losses to fell below 16400 mark. Traders took note with Fitch Ratings' statement that India's economy is rapidly recovering from the pandemic but uncertainties remain around its medium-term debt trajectory. It stated ‘The medium-term debt trajectory remains core to our sovereign assessment and fiscal consolidation may be slower than we previously expected based on the February 1, 2022 budget.’ It added financial institutions face an uneven recovery due to lingering asset-quality risks and capital limitations. Finally, Nifty finished the session with the cut of around five percentage points.

All the sectoral indices ended in red. The top gainers from the F&O segment were IndiaMART InterMESH, Nippon Life India Asset Management and Hindalco. On the other hand, the top losers were RAIN, PNB and Indus Tower. In the index option segment, maximum OI continues to be seen in the 16900 -17100 calls and 15900 -16150 puts indicating this is the trading range expectation.

India Volatility Index (VIX), a gauge for market’s short-term expectation of volatility increased by 30.31% and reached 31.98. The 50 share Nifty down by 815.30 points or 4.78% to settle at 16,247.95.

Nifty March 2022 futures closed at 16233.00 (LTP) on Thursday, at a discount of 14.95 points over spot closing of 16247.95, while Nifty April 2022 futures ended at 16290.00 (LTP), at a premium of 42.05 points over spot closing. Nifty March futures saw an addition of 1,09,889 units, taking the total  open interest (contracts) to 2,47,558 units. The near month derivatives contract will expire on March 31, 2022 (Provisional).

From the most active contracts, Reliance Industries March 2022 futures traded at a premium of 6.35 points at 2256.35 (LTP) compared with spot closing of 2250.00. The numbers of contracts traded were 84,848 (Provisional).

Infosys March 2022 futures traded at a premium of 3.70 points at 1678.50 (LTP) compared with spot closing of 1674.80. The numbers of contracts traded were 62,627 (Provisional).

Tata Steel March 2022 futures traded at a premium of 0.00 points at 1079.00 (LTP) compared with spot closing of 1079.00. The numbers of contracts traded were 57,691 (Provisional).

TCS March 2022 futures traded at a premium of 11.55 points at 3412.00 (LTP) compared with spot closing of 3400.45. The numbers of contracts traded were 54,439 (Provisional).

ICICI Bank March 2022 futures traded flat with spot closing of 706.00. The numbers of contracts traded were 42,001 (Provisional).

Among, Nifty calls, 17000 SP from the March month expiry was the most active call with an addition of 7,873 units open interests. Among Nifty puts, 16000 SP from the March month expiry was the most active put with an addition of 13,532 units open interests. The maximum OI outstanding for Calls was at 17000 SP (34,435 units) and that for Puts was at 16000 SP (83,655 units). The respective Support and Resistance levels of Nifty are: Resistance 16,567.72 --Pivot Point 16,385.48 -- Support --16,065.72.

The Nifty Put Call Ratio (PCR) finally stood at (2.03) for March month contract. The top five scrips with highest PCR on JK Cements (19.00), Hindustan Aeronautics (2.36), Intellect Design Arena (1.55), Ramco Cements (1.17) and ABB (1.17).

Among most active underlying, Reliance Industries witnessed an addition of 39,259 units of Open Interest in the March month futures contract, ICICI Bank witnessed an addition of 14,829 units of Open Interest in the March month futures contract, Tata Motors witnessed an addition of 5,485 units of Open Interest in the March month futures contract, Infosys witnessed an addition of 27,418 units of Open Interest in the March month futures contract and HDFC Bank witnessed an addition of 9,263 units of Open Interest in the March month futures contract (Provisional).