Informist, Tuesday, May 9, 2023
By Ananya Grover
MUMBAI – Traders wrote some of their positions on both call and put sides today as the Nifty 50 ended flat ahead of its weekly expiry on Thursday. Investors were also cautious ahead of US inflation data for April on Wednesday.
The Nifty 50 index ended flat at 18265.95 points. “Nifty opened positive, but some profit booking at higher levels led to flat closing for the day,” said Siddhartha Khemka, head of retail-research at Motilal Oswal Financial Services.
An analyst at Axis Securities said that a jump in the put call ratio to 1.08 level and rise in volatility index indicate that the market will move cautiously. The Nifty 50 is likely to consolidate going forward and move between 18220 and 18380 points on Wednesday, he added.
India VIX ended 0.33% higher at 12.68. However, Viraj Vyas, an analyst at Ashika Stock Broking, said that this rise only indicates a healthy regime change.
On the call side, maximum number of fresh positions were added at 18350 level of the Nifty 50, with open interest rising by 4.3 mln. The open interest at 18300 strike price was 3.03 mln higher and premium fell 21.5% after the spot index fell below this level.
The analyst with Axis Securities said call writing at 18300 strike indicates “stoppage” and if that continues, the Nifty 50 is not going to make wider upmoves.
In the put segment, traders aggressively sold contracts in 17800-18350 range, indicating that the market will be range-bound in the next session.
Going forward, a breakout on either side of the 18200-18300 range of the Nifty 50 will decide the momentum at expiry, Vyas said.
Among sectors, analysts see automobile stocks outperforming the market in the near term, followed by banking, fast-moving consumer goods and pharmaceutical.
The May futures contract of the Nifty 50 closed at a premium of 39.05 points to the spot index. Open interest in the contract was 4.96% higher at 11.36 mln, as per provisional data.
–Nifty 50 May closed at 18305.00, down 5.40 points; 39.05-point premium to spot index
–Nifty 50 Jun closed at 18369.00, down 12.55 points; 103.05-point premium to spot index
–Nifty 50 Jul closed at 18432.00, down 9.15 points; 166.05-point premium to spot index
HDFC Bank, ICICI Bank, Canara Bank, Tata Motors, and State Bank of India were among the most-actively traded underlying. End
Edited by Ashish Shirke
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