Wiping all of its earlier losses, Indian equity benchmark -- Nifty -- ended flat on Friday amid subdued global cues. Sentiments remained downbeat with the report that the Reserve Bank of India (RBI) is likely to keep key interest rates unchanged on April 6, 2017. The RBI shifted to a neutral stance from accommodative in February and this, in turn, may prompt the central bank to hold rates in the ensuing meet early next month. However, investors got some confidence with Economic Affairs Secretary Shaktikanta Das’ statement that GST is an outcome of hard work done over last many years and it would remove the shadow economy. Das has also said that the tax net will be widened under the new regime and this may result in reduction of general tax rate. Further, some support also came with the private report stating that the effect of demonetisation is fading and growth is likely to return to the pre-note ban stage, but a clearer picture of the economy will be available by June-end.
Traders were seen piling up positions in Metal, Media and PSU stocks, while selling was witnessed in Financial Services, FMCG and IT stocks. The top gainers from the F&O segment were Capital First, The South Indian Bank and Indian Bank. On the other hand, the top losers were Infibeam Incorporation, Torrent Power and Just Dial. In the index option segment, maximum OI continues to be seen in the 9000-9500 calls and 8500-9200 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 2.22% and reached 12.42. The 50-share Nifty ended flat at 9,173.75.
Nifty April 2017 futures closed at 9197.75 on Friday at a premium of 24 points over spot closing of 9173.75, while Nifty May 2017 futures ended at 9220.55, at a premium of 46.80 points over spot closing. Nifty April futures saw a contraction of 0.19 million (mn) units, taking the total outstanding open interest (OI) to 22.94 million (mn) units. The near month derivatives contract will expire on April 27, 2017.
From the most active contracts, Reliance Industries April 2017 futures traded at a premium of 5.60 points at 1326.20 compared with spot closing of 1,320.60. The numbers of contracts traded were 43,550.
State Bank of India April 2017 futures traded at a discount of 0.05 points at 293.25 compared with spot closing of 293.30. The numbers of contracts traded were 18,759.
Infibeam Incorporation April 2017 futures traded at a premium of 1.30 points at 945.30 compared with spot closing of 944.00. The numbers of contracts traded were 18,254.
Reliance Capital April 2017 futures traded at a premium of 2.55 points at 617.55 compared with spot closing of 615.00. The numbers of contracts traded were 10,706.
Axis Bank April 2017 futures traded at a premium of 2.65 points at 493.45 compared with spot closing of 490.80. The numbers of contracts traded were 10,364.
Among Nifty calls, 9200 SP from the April month expiry was the most active call with an addition of 0.55 million open interests. Among Nifty puts, 9100 SP from the April month expiry was the most active put with an addition of 0.56 million open interests. The maximum OI outstanding for Calls was at 9200 SP (3.35 mn) and that for Puts was at 9000 SP (3.70 mn). The respective Support and Resistance levels of Nifty are: Resistance 9192.93--- Pivot Point 9172.52--- Support --- 9153.33.
The Nifty Put Call Ratio (PCR) finally stood at 0.89 for April month contract. The top five scrips with highest PCR on OI were Indian Bank (3.62), Tata Consultancy Services (2.08), Amara Raja Batteries (1.99), KPIT Technologies (1.97) and Indraprastha Gas (1. 50).
Among most active underlying, Reliance Industries witnessed an addition of 0.52 million units of Open Interest in the April month futures contract, followed by State Bank of India witnessing a contraction of 0.94 million units of Open Interest in the April month contract, Reliance Capital witnessed an addition of 0.73 million units of Open Interest in the April month contract, Punjab National Bank witnessed an addition of 0.71 million units of Open Interest in the April month future contract and ICICI Bank witnessed an addition of 2.64 million units of Open Interest in the April month future contract.