Nifty ends lower on Tuesday amid profit taking

S&P CNX Nifty ended Tuesday’s session below 17700 mark on profit taking. India VIX was down by 3.11%. Market made slightly positive start, as traders took support after finance ministry in its monthly economic review stated that India’s growth and stability concerns are less than that of the world at large, and estimated the country’s medium-term growth rate above 6 percent. However, market failed to protect gains and soon entered into red zone, as traders were cautious after foreign investors have pulled out close to Rs 6,000 crore from the Indian equity markets so far this month in the wake of strength in the US dollar against the rupee. Traders remained concerned as private report stated that the government will not infuse any capital into public sector banks (PSBs) this financial year (FY23). This will happen for the first time since FY08.

In afternoon session, index continued to reel under pressure, as sentiments remained in lackadaisical mood with Reserve Bank of India’s (RBI) statement that India’s forex reserves dropped by $4.50 billion to $528.37 billion for the week ended October 14. Foreign Currency Assets (FCA), a major component of the overall reserves, saw a drop of $2.828 billion to $468.668 billion during the week to October 14. In last leg of trade, market touched its day’s low point. Sentiments continued to hit after ministry of Statistics and Programme Implementation in its latest data report has showed that a total of 986,850 people subscribed to employee provident fund during the month of August, an 11 per cent decline in comparison to the previous month. Finally, Nifty ended day’s trade in negative territory.

Traders were seen piling positions in Auto, IT and Metal sector while selling was witnessed in Bank, FMCG and Media sector stocks.  The top gainers from the F&O segment were MCX, BHEL and MGL. On the other hand, the top losers were Indus Towers, IDFC and Laurus Labs. In the index option segment, maximum OI continues to be seen in the 17900 -18200 calls and 16900 -17150 puts indicating this is the trading range expectation.

India Volatility Index (VIX), a gauge for market’s short-term expectation of volatility decreased by 3.11% and reached 16.88. The 50 share Nifty down by 74.40 points or 0.42% to settle at 17,656.35.

Nifty October 2022 futures closed at 17654.85 (LTP) on Tuesday, at a discount of 1.50 points over spot closing of 17656.35, while Nifty November 2022 futures ended at 17686.20 (LTP), at a premium of 29.85 points over spot closing. Nifty October futures saw an contraction of 5,226 units, taking the total open interest (Contracts) to 1,97,544 units. The near month derivatives contract will expire on October 27, 2022. (Provisional)

From the most active contracts, Reliance Industries October 2022 futures traded at a premium of 2.70 points at 2444.50 (LTP) compared with spot closing of 2441.80. The numbers of contracts traded were 46,056. (Provisional)

Infosys October 2022 futures traded at a discount of 12.75 points at 1513.25 (LTP) compared with spot closing of 1526.00. The numbers of contracts traded were 40,340. (Provisional)

Tata Motors October 2022 futures traded at a premium of 1.30 points at 405.50 (LTP) compared with spot closing of 404.20. The numbers of contracts traded were 30,500. (Provisional)

HDFC Bank October 2022 futures traded at a premium of 0.85 points at 1448.25 (LTP) compared with spot closing of 1447.40. The numbers of contracts traded were 30,302. (Provisional)

State Bank of India October 2022 futures traded at a premium of 0.50 points at 577.50 (LTP) compared with spot closing of 577.00. The numbers of contracts traded were 25,539. (Provisional)

Among, Nifty calls, 17700 SP from the October month expiry was the most active call with an addition of 39,876 units open interests. Among Nifty puts, 17600 SP from the October month expiry was the most active put with a contraction of 22,227 units open interests. The maximum OI outstanding for Calls was at 18000 SP (2,26,245 units) and that for Puts was at 17000 SP (1,41,392 units). The respective Support and Resistance levels of Nifty are: Resistance 17,766.23 -- Pivot Point 17,701.62 -- Support -- 17,591.73.

The Nifty Put Call Ratio (PCR) finally stood at (0.80) for October month contract. The top five scrips with highest PCR on Canara Bank (1.70), Bank of Baroda (1.46), PNB (1.28), IDFC (1.24) and Axis Bank (1.21).

Among most active underlying, ICICI Bank witnessed an addition of 1,275 units of Open Interest in the October month futures, Reliance Industries witnessed an addition of 28 units of Open Interest in the October month futures, HDFC Bank witnessed a contraction of 3,137 units of Open Interest in the October month futures, SBIN witnessed an addition of 285 units of Open Interest in the October month futures and Axis Bank witnessed a contraction of 359 units of Open Interest in the October month futures. (Provisional)