Last leg of selling drags Nifty lower

Last leg of selling forced the S&P CNX Nifty to end last trading day of week in red zone. Market made positive start, as SBI Research projected the Indian economy to grow at 7.5 per cent in 2022-23, an upward revision of 20 basis points from its earlier estimate. It said ‘given the high inflation and the subsequent upcoming rate hikes, we believe that real GDP will incrementally increase by Rs 11.1 lakh crore in FY23’. Further, index extended its gains, as commerce ministry said India's merchandise exports rose by 15.46 per cent to $37.29 billion in May on account of healthy performance by sectors like petroleum products, electronic goods and chemicals, even as the trade deficit widened to $23.33 billion during the month. 

Market continue to trade higher after India's dominant services sector expanded at the fastest pace in 11 years in May on strong demand, although inflationary pressures touched new highs, restricting optimism and weighing on consumers' pocketbooks. However, market failed to protect its gains and slipped into negative territory. Finally, Nifty closed the session below 16600 mark.

Most of the sectoral indices ended in red except IT and Oil & Gas. The top gainers from the F&O segment were Metropolis Healthcare, Indiabulls Housing Finance and Birlasoft. On the other hand, the top losers were J K Cement, Dalmia Bharat and Ramco Cements. In the index option segment, maximum OI continues to be seen in the 17400 -17800 calls and 16400 -16600 puts indicating this is the trading range expectation.

India Volatility Index (VIX), a gauge for market’s short-term expectation of volatility decreased by 1.69% and reached 19.98. The 50 share Nifty down by 43.70 points or 0.26% to settle at 16,584.30.

Nifty June 2022 futures closed at 16601.00 (LTP) on Friday, at a premium of 16.70 points over spot closing of 16584.30, while Nifty July 2022 futures ended at 16624.95 (LTP), at a premium of 40.65 points over spot closing. Nifty June futures saw a contraction of 0.01 million (mn) units, taking the total outstanding open interest (OI) to 1,86,358 mn units. The near month derivatives contract will expire on June 30, 2022 (Provisional).

From the most active contracts, Reliance Industries June 2022 futures traded at a premium of 3.55 points at 2781.55 (LTP) compared with spot closing of 2778.00. The numbers of contracts traded were 61,456 (Provisional).

Infosys June 2022 futures traded at a premium of 7.25 points at 1530.00 (LTP) compared with spot closing of 1522.75. The numbers of contracts traded were 37,433 (Provisional).

UltraTech Cement June 2022 futures traded at a premium of 22.40 points at 5700.00 (LTP) compared with spot closing of 5677.60. The numbers of contracts traded were 21,896 (Provisional).

Wipro June 2022 futures traded at a premium of 1.70 points at 478.45 (LTP) compared with spot closing of 476.75. The numbers of contracts traded were 18,268 (Provisional).

Tata Steel June 2022 futures traded at a discount of 48.70 points at 1018.30 (LTP) compared with spot closing of 1067.00. The numbers of contracts traded were 17,902 (Provisional).

Among, Nifty calls, 17000 SP from the June month expiry was the most active call with a contraction of 1,568 units open interests. Among Nifty puts, 16500 SP from the June month expiry was the most active put with a contraction of 1,141 units open interests. The maximum OI outstanding for Calls was at 17500 SP (47,606 units) and that for Puts was at 16500 SP (63,328 units). The respective Support and Resistance levels of Nifty are: Resistance 16,729.47 --- Pivot Point 16,648.68 -- Support -- 16,503.52.

The Nifty Put Call Ratio (PCR) finally stood at (1.34) for June month contract. The top five scrips with highest PCR on Atul (1.48), Hero Motocorp (1.08), Piramal Enterprises (0.97), Power Grid (0.92) and ACC (0.91).

Among most active underlying, Reliance Industries witnessed an addition of 6,162 units of Open Interest in the June month futures, Infosys witnessed an addition of 6,162 units of Open Interest in the June month futures, ICICI Bank witnessed an addition of 1,469 units of Open Interest in the June month futures contract, HDFC Bank witnessed an addition of 955 units of Open Interest in the June month futures contract and UltraTech Cement witnessed an addition of 1,469 units of Open Interest in the June month futures contract (Provisional).