Indian equity benchmark -- Nifty -- traded in a narrow range throughout the day and ended the session with marginal gains. Sentiments got some support with the report that the tax collection figures up to January 2017 have shown consistent trend of healthy growth in both Direct and Indirect Taxes as the net indirect tax grew at the rate of 16.9 percent compared to corresponding month last year with growth rate in net collections for customs, central excise and service tax at the rate of 10.1 percent, 26.3 percent and 9.4 percent respectively January, 2017. Further, investors remained positive with credit rating agency, India Ratings’ report that despite the cash shortage hurting some sectors significantly in the third quarter, the impact of demonetisation on the credit profile of large corporates (revenue over Rs 250 crore) remained neutral, with no significant changes in their ratings expected due to the notes ban move. However, investor sentiments remained cautious ahead of IIP numbers for December.
Traders were seen piling up positions in IT, Banking and PSU stocks, while selling was witnessed in Pharma, FMCG and Auto stocks. The top gainers from the F&O segment were United Spirits, Grasim Industries and PTC India. On the other hand, the top losers were Steel Authority of India, Jaiprakash Associates and Aurobindo Pharma. In the index option segment, maximum OI continues to be seen in the 8700-9200 calls and 8000-8800 puts indicating this is the trading range expectation.
The India Volatility Index (VIX), a gauge for market’s short term expectation of volatility decreased by 0.43% and reached 13.17. The 50-share Nifty was up by 15.15 points or 0.17% to settle at 8,793.55.
Nifty February 2017 futures closed at 8809.35 on Friday at a premium of 15.80 points over spot closing of 8793.55, while Nifty March 2017 futures ended at 8839.95, at a premium of 46.40 points over spot closing. Nifty February futures saw a contraction of 0.07 million (mn) units, taking the total outstanding open interest (OI) to 21.68 million (mn) units. The near month derivatives contract will expire on February 23, 2017.
From the most active contracts, State Bank of India February 2017 futures traded at a premium of 2.15 points at 277.35 compared with spot closing of 275.20. The numbers of contracts traded were 46,967.
Infosys February 2017 futures traded at a premium of 0.70 points at 967.70 compared with spot closing of 967.00. The numbers of contracts traded were 23,062.
Bank of Baroda February 2017 futures traded at a premium of 0.45 points at 188.35 compared with spot closing of 187.90. The numbers of contracts traded were 15,050.
Tata Steel February 2017 futures traded at a premium of 2.75 points at 469.80 compared with spot closing of 467.05. The numbers of contracts traded were 13,579.
Aurobindo Pharma February 2017 futures traded at a premium of 1.90 points at 679.95 compared with spot closing of 678.05. The numbers of contracts traded were 12,127.
Among Nifty calls, 8800 SP from the February month expiry was the most active call with an addition of 0.02 million open interests. Among Nifty puts, 8800 SP from the February month expiry was the most active put with an addition of 0.49 million open interests. The maximum OI outstanding for Calls was at 9000 SP (6.89 mn) and that for Puts was at 8500 SP (6.14 mn). The respective Support and Resistance levels of Nifty are: Resistance 8820.03--- Pivot Point 8795.62--- Support --- 8769.13.
The Nifty Put Call Ratio (PCR) finally stood at 1.19 for February month contract. The top five scrips with highest PCR on OI were Oracle Financial Services Software (2.00), Sun TV Network (1.89), Tata Consultancy Services (1.27), United Breweries (1.24) and Bharti Airtel (1.17).
Among most active underlying, State Bank of India witnessed an addition of 4.46 million units of Open Interest in the February month futures contract, followed by Tata Steel witnessing a contraction of 0.31 million units of Open Interest in the February month contract, Infosys witnessed a contraction of 2.16 million units of Open Interest in the February month contract, Bank of Baroda witnessed an addition of 0.57 million units of Open Interest in the February month future contract and ICICI Bank witnessed a contraction of 0.98 million units of Open Interest in the February month future contract.