Informist, Tuesday, Feb 15, 2022
By Vivek Kumar and Abhishek Saini
MUMBAI – As benchmark equity indices pulled off a stellar recovery today amid easing tensions between Russia and Ukraine, investors’ faith in equities got a boost and this was reflected in the derivatives segment of the market as well. Not only did traders cover their short positions, some also added long positions and open interest in the benchmark Nifty 50’s February futures contract rose nearly 7% to over 10 mln.
In the options segment, premiums of the 17700- and 17800-point call options trebled, while those of deep-out-of-the-money call options fell. On the other hand, put writers were active across major strike prices.
Though the indices recovered almost all of Monday’s losses today, the sustenance of this recovery on Wednesday will be crucial, analysts said.
While sustaining above 17200 points is a key factor for the Nifty 50 from a short-term perspective, a decisive breakout above 17400-17450 points could open the gate for movement towards 17800 points, said Vijay Dhanotia, category lead – HNI products at CapitalVia Global Markets.
Today, the Nifty 50 closed 3% higher at 17352.45 points. As with the Monday’s slump, the recovery today was also spearheaded by banks. With all its constituents in the green, the Nifty Bank index ended 3.4% higher at 38170.10 points.
After aggressive build-up of short positions on Monday, the counter witnessed short covering today, followed by addition of some long positions.
Shares of some information technology and a few automobile companies also rose sharply amid bargain buying after the sharp correction witnessed by the sector lately.
–Nifty 50 Feb ended at 17365.00, up 527.15 points; 12.55-point premium to spot index
–Nifty 50 Mar ended at 17413.05, up 510.25 points; 60.60-point premium to spot index
–Nifty 50 Apr ended at 17472.55, up 513.45 points; 120.10-point premium to spot index
The total turnover in the futures and options segment of the National Stock Exchange was higher at 102.2 trln rupees as compared to 68.5 trln rupees on Monday.
The turnover in index options was at 98 trln rupees against 64.7 trln rupees the previous day. The total premium turnover of index and stock options was also higher at 535.8 bln rupees compared to 445 bln rupees on Monday.
The most actively traded underlying stocks were Tata Consultancy Services, Tata Motors, ICICI Bank, State Bank of India, HDFC Bank, Reliance Industries, Infosys, Housing Development Finance Corp, Axis Bank and Bajaj Finance. End
Edited by Avishek Dutta
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Source: Cogencis