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Tuesday, December 5, 2023

Equity Futures:Call options sold at 19500; Nifty 50 seen range-bound

Informist, Wednesday, Aug 30, 2023


By Maitri Seth


MUMBAI – Traders sold call options at 19400-19500 strike prices of the Nifty 50, as the index is likely to remain consolidated below 19500 points in the next session, ahead of the weekly derivatives expiry on Thursday.


Call writing was seen at 19500-19600 strike prices, which is a crucial resistance for the Nifty 50 and is difficult to cross, said Ratnesh Goyal, technical and derivatives analyst at Arihant Capital Markets. The analyst expects the Nifty 50 to move in a range of 19250-19500 points in the next few sessions, attributing the range-bound trend to lack of major triggers.


Premium of call options at 19500 points fell 44.5% to 5.05 rupees, while that of 19400 and 19450 levels slipped 34.5% and 45.1% to 18.90 rupees and 9 rupees, respectively.


On the other hand, although premium of put options at 19350 levels of the Nifty 50 declined from the previous session, it went off lows during the day on hopes that the Nifty 50 would remain above 19350 points in the upcoming sessions. Premiums at 19200 and 19250 levels declined 57.6% and 53.4% to 5.75 rupees and 10.50 rupees, respectively, from Tuesday, but recovered slightly.


The decline in premiums is largely due to the monthly derivatives expiry scheduled for Thursday, Goyal added. 


Today, the Nifty 50 closed flat at 19347.45 points, after a volatile session, while broader markets outperformed. The Nifty 50 saw profit-booking in the last hour, leading to the index giving up its gains and closing flat, said Siddhartha Khemka, head of research at Motilal Oswal Financial Services.Nifty is likely to remain in consolidation mode while sector rotation would lead to stock-specific action,” he said.


Among sectors, banks are expected to witness some bullishness, as they have been underperforming since the last few sessions. HDFC Bank among large-cap stocks and South Indian Bank among small-caps are likely to do well in the next session.


For next week, traders rolled over 44% positions of the Nifty 50 August futures contracts to the September series as of Tuesday, higher than the average of 39% for the past three expiries, according to brokerage Nirmal Bang.


The August futures contract of the Nifty 50 today closed at a discount of 7.45 points to the spot index. Open interest in the contract was down 0.3% at 7.4 mln, according to provisional data.


–Nifty 50 Aug closed at 19340, up 2.95 points; 7.45-point discount to spot index

–Nifty 50 Sep closed at 19445, up 8.60 points; 97.55-point premium to spot index

–Nifty 50 Oct closed at 19539.90, up 12.05 points; 192.45-point premium to spot index


HDFC Bank, Reliance Industries, ICICI Bank, State Bank of India, and Bharat Heavy Electricals were among the most actively traded underlying stocks.  End


Edited by Avishek Dutta


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Source: Cogencis

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