Nifty snapped six day winning streak on Monday. Market made pessimistic start with a private report that Indian rupee may further depreciate to 82 to a dollar in the near term due to widening of trade deficit and expected aggressive rate hike by the US Fed later this week to tame record high inflation. Further, market added more losses with India Ratings’ report stated that the banks are unlikely to take a big hit on profitability this quarter due to rising bond yields, which may eat up 5.3 per cent (Rs 11,790 crore) of their net income in the worst-case scenario. It also said that in the worst-case scenario, banks may see a profit erosion of 2.6 per cent of their pre-provisioning operating profit and 5.3 per cent of their post-tax profit from treasury losses in Q1.
In late afternoon session, index trimmed most of its losses after Finance Minister Nirmala Sitharaman said that the trust-based taxation system introduced by the government has resulted in improved collections and increase in the number of return filings. The finance minister complimented the department for achieving the highest-ever revenue collection of over Rs 14 lakh crore in the last fiscal and expressed hope that the momentum would continue in the current fiscal too. But, index finally closed the session below 16650 mark, as the government is not considering extending the last date for filing income tax returns as it expects most returns to come in by the due date of July 31. Revenue Secretary Tarun Bajaj said over 2.3 crore income returns were filed by July 20 for fiscal 2021-22 and the numbers are picking up.
Most of the sectoral indices ended in red except IT and Metal. The top gainers from the F&O segment were Navin Fluorine International, Gail and SRF. On the other hand, the top losers were M&M, Bandhan Bank and Gujarat State Petronet. In the index option segment, maximum OI continues to be seen in the 16950 -17200 calls and 15950 -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 6.18% and reached 17.68. The 50 share Nifty down by 88.45 points or 0.53% to settle at 16,631.00.
Nifty July 2022 futures closed at 16620.00 on Monday, at a discount of 11.00 points over spot closing of 16631.00, while Nifty August 2022 futures ended at 16634.85, at a premium of 3.85 points over spot closing. Nifty July futures saw a contraction of 9,254 units, taking the total open interest (Contracts) to 1,70,870 units. The near month derivatives contract will expire on July 28, 2022 (Provisional).
From the most active contracts, Reliance Industries July 2022 futures traded at a premium of 1.65 points at 2419.05 (LTP) compared with spot closing of 2417.40. The numbers of contracts traded were 66,351 (Provisional).
Infosys July 2022 futures traded at a premium of 3.95 points at 1505.95 (LTP) compared with spot closing of 1502.00. The numbers of contracts traded were 43,775 (Provisional).
HDFC Bank July 2022 futures traded at a premium of 1.00 points at 1395.00 (LTP) compared with spot closing of 1394.00. The numbers of contracts traded were 39,211 (Provisional).
Tata Steel July 2022 futures traded at a premium of 1.70 points at 966.40 (LTP) compared with spot closing of 964.70. The numbers of contracts traded were 39,081 (Provisional).
ICICI Bank July 2022 futures traded at a discount of 1.00 points at 799.00 (LTP) compared with spot closing of 800.00. The numbers of contracts traded were 32,519 (Provisional).
Among, Nifty calls, 16700 SP from the July month expiry was the most active call with an addition of 47,034 units open interests. Among Nifty puts, 16600 SP from the July month expiry was the most active put with an addition of 5,152 units open interests. The maximum OI outstanding for Calls was at 17000 SP (1,76,865 units) and that for Puts was at 16000 SP (1,29,184 units). The respective Support and Resistance levels of Nifty are: Resistance 16,703.28 -- Pivot Point 16,633.77 -- Support -- 16,561.48.
The Nifty Put Call Ratio (PCR) finally stood at (1.07) for July month contract. The top five scrips with highest PCR on LTI (1.52), Titan Company (1.32), ACC (1.27), Asian Paints (1.27) and Bank of Baroda (1.26).
Among most active underlying, Reliance Industries witnessed an addition of 9,434 units of Open Interest in the July month futures, ICICI Bank witnessed an addition of 1,602 units of Open Interest in the July month futures, HDFC Bank witnessed a contraction of 1,995 units of Open Interest in the July month futures, Infosys witnessed a contraction of 2,318 units of Open Interest in the July month futures and Adani Enterprises witnessed an addition of 267 units of Open Interest in the July month futures (Provisional).
