Indian equity benchmark -- Nifty -- ended the first day of the new trading week on optimistic note as investors took comfort from progress in GST. The GST council moving a step closer towards implementing the Goods and Services Tax (GST) from July 1, approving two crucial supporting legislations of central GST law (CGST) and the integrated GST (IGST) law for this ambitious tax reform. Sentiments remained upbeat with a report that foreign direct investment (FDI) to India’s services sector shot up 77.6 per cent to $7.55 billion during the first nine months of FY17 on the back of government steps to improve ease of doing business. The services sector had received FDI worth $4.25 billion during the April-December period of 2015-16. Some support also came with Minister of State for Petroleum and Natural Gas Dharmendra Pradhan’s statement that India’s gross domestic product (GDP) will achieve 8% growth and continue its momentum for the next financial year, even after demonetising about 85% of all currency in circulation last November.
Traders were seen piling up positions in PSU, Auto and Realty stocks, while selling was witnessed in IT and Pharma stocks. The top gainers from the F&O segment Adani Power, Indo Count Industries and Reliance Industries. On the other hand, the top losers were Hexaware Technologies, Aditya Birla Nuvo and Grasim Industries. In the index option segment, maximum OI continues to be seen in the 8900-9500 calls and 8400-9000 puts indicating this is the trading range expectation.
The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility increased by 2.15% and reached 13.64. The 50-share Nifty was up by 65.90 points or 0.74% to settle at 8963.45.
Nifty March 2017 futures closed at 8979.15 on Monday at a premium of 15.70 points over spot closing of 8963.45, while Nifty April 2017 futures ended at 9004.85, at a premium of 41.40 points over spot closing. Nifty March futures saw an addition of 0.08 million (mn) units, taking the total outstanding open interest (OI) to 21.62 million (mn) units. The near month derivatives contract will expire on March 30, 2017.
From the most active contracts, Reliance Industries March 2017 futures traded at a discount of 0.10 points at 1307.90 compared with spot closing of 1308.00. The numbers of contracts traded were 46,511.
Hindalco Industries March 2017 futures traded at a premium of 0.20 points at 200.10 compared with spot closing of 199.90. The numbers of contracts traded were 17,405.
Reliance Infrastructure March 2017 futures traded at a premium of 4.55 points at 587.25 compared with spot closing of 582.70. The numbers of contracts traded were 11,430.
Reliance Capital March 2017 futures traded at a premium of 4.10 points at 546.25 compared with spot closing of 542.15. The numbers of contracts traded were 11,330.
Tata Motors March 2017 futures traded at a premium of 3.10 points at 473.35 compared with spot closing of 470.25. The numbers of contracts traded were 11,269.
Among Nifty calls, 9000 SP from the March month expiry was the most active call with a contraction of 0.16 million open interests. Among Nifty puts, 8900 SP from the March month expiry was the most active put with a contraction of 0.02 million open interests. The maximum OI outstanding for Calls was at 9000 SP (5.16 mn) and that for Puts was at 8800 SP (4.20 mn). The respective Support and Resistance levels of Nifty are: Resistance 8982.83--- Pivot Point 8948.42--- Support --- 8929.03.
The Nifty Put Call Ratio (PCR) finally stood at 0.93 for March month contract. The top five scrips with highest PCR on OI were Tata Consultancy Services (1.24), Indo Count Industries (1.15), Reliance Industries (1.00), NIIT Technologies (1.00) and Hexaware Technologies (0.98).
Among most active underlying, Reliance Industries witnessed an addition of 0.51million units of Open Interest in the March month futures contract, followed by Hindalco Industries witnessing a contraction of 2.35 million units of Open Interest in the March month contract, Tata Steel witnessed a contraction of 0.12 million units of Open Interest in the March month contract, State Bank of India witnessed a contraction of 2.53 million units of Open Interest in the March month future contract and Bharat Financial Inclusion witnessed an addition of 0.90 million units of Open Interest in the March month future contract.