Nifty ekes out slender gain ahead of RBI policy outcome

Nifty ended tad above the neutral line as traders remained on sidelines ahead of RBI Monetary Policy Committee meeting’s outcome. market participants will be keenly watching the committee's rate hike stance. Market made a cautious start and witnessed selling as day progressed as traders were worried even after private survey showed India's output in the services sector expanded at the quickest pace in three months owing to demand strength, successful marketing and a sustained upturn in sales. The seasonally adjusted S&P Global India Services PMI Business Activity Index rose to 56.4 in November from 55.1 in October, as the new orders placed with service providers in India rose for the sixteenth straight month.

However, in afternoon session market pared all the losses and managed to enter into green terrain as traders got some solace with Reserve Bank of India's weekly statistical supplement showing India's foreign exchange reserves rose for the third straight week, to $550.14 billion in the week through November 25. For the week ended November 18, the country's reserves were at $547.25 billion. Some support also came with private report stating that foreign investors have upgraded India as a dedicated allocation in their investment portfolios given the strong economy, stable government and significant reforms undertaken over the last eight years. Despite volatility in last leg of trade, market managed to end the session slightly in green.

Traders were seen piling positions in Bank, Financial Services and MEDIA sector while selling was witnessed in Auto, FMCG and IT stocks. The top gainers from the F&O segment were Mahindra & Mahindra Financial Services Piramal Enterprises and Hindalco Industries. On the other hand, the top losers were TVS Motor Company, Dalmia Bharat and Bharat Heavy Electricals. In the index option segment, maximum OI continues to be seen in the 18900 -19100 calls and 17900 -18100 puts indicating this is the trading range expectation.

India Volatility Index (VIX), a gauge for market’s short-term expectation of volatility increased by 2.10% and reached 13.73. The 50 share Nifty up by 4.95 points or 0.02% to settle at 18,701.05.

Nifty December 2022 futures closed at 18821.25 (LTP) on Monday, at a premium of 120.20 points over spot closing of 18701.05, while Nifty January 2023 futures ended at 18915.75 (LTP), at a premium of 214.70 points over spot closing. Nifty December futures saw an addition 3,325 units, taking the total outstanding open interest (Contracts) to 2,32,564 units. The near month derivatives contract will expire on December 29, 2022. (Provisional)   

From the most active contracts, Reliance Industries December 2022 futures traded at a premium of 22.60 points at 2704.60 (LTP) compared with spot closing of 2682.00. The numbers of contracts traded were 33,754. (Provisional)   

Adani Enterprises December 2022 futures traded at a premium of 28.25 points at 3958.45 (LTP) compared with spot closing of 3930.20. The numbers of contracts traded were 22,440. (Provisional)   

Tata Steel December 2022 futures traded at a premium of 1.05 points at 116.50 (LTP) compared with spot closing of 115.45. The numbers of contracts traded were 20,564. (Provisional)   

Infosys December 2022 futures traded at a premium of 9.35 points at 1648.00 (LTP) compared with spot closing of 1638.65. The numbers of contracts traded were 14,991. (Provisional)   

HDFC Bank December 2022 futures traded at a premium of 11.25 points at 1624.25 (LTP) compared with spot closing of 1613.00. The numbers of contracts traded were 13,898. (Provisional)  

Among, Nifty calls, 18800 SP from the December month expiry was the most active call with a contraction of 1,803 units open interests. Among Nifty puts, 18700 SP from the December month expiry was the most active put with an addition of 3,671 units open interests. The maximum OI outstanding for Calls was at 19000 SP (68,912 units) and that for Puts was at 18000 SP (69,878 units). The respective Support and Resistance levels of Nifty are: Resistance 18755.98 -- Pivot Point 18673.66 -- Support -- 18618.73.

The Nifty Put Call Ratio (PCR) finally stood at (1.35) for December month contract. The top five scrips with highest PCR on Aditya Birla Capital (1.17), Lupin (1.08), Britannia Industries (1.03), PCA Laboratories (1.00) and Apollo Tyres (0.94).

Among most active underlying, Reliance Industries witnessed an addition of 6,464 units of Open Interest in the December month futures, Adani Enterprises witnessed an addition of 1,347 units of Open Interest in the December month futures, ICICI Bank witnessed a contraction of 919 units of Open Interest in the December month futures, HDFC Bank India witnessed an addition of 515 units of Open Interest in the December month futures, and State Bank of India witnessed an addition of 730 units of Open Interest in the December month futures. (Provisional)