More Stories

Informist, Thursday, Oct. 10, 2024

By Anjana Therese Antony

MUMBAI – Traders are indecisive about the domestic market's direction Friday and premiums on put and call options of the Nifty 50 declined across strikes. The absence of major cues in the domestic market and expensive valuations may continue to keep gains in the market limited in the short term, analysts said, while the September quarter earnings season will be closely tracked by investors. 

The Nifty 50 ended 0.1% higher at 24998.45 points and the BSE Sensex closed 0.2% higher at 81611.41 points. The near-term support for the 50-stock index is pegged at 24900-24800 points and resistance at 25100-25200 points, according to technical and derivatives analysts at three broking firms. 

Analysts expect further slowdown in earnings growth for Indian companies in Jul-Sept, with muted demand trends and fading margin tailwinds, among others, weighing on business performance. They also see possible earnings downgrades and stretched valuations, coupled with the unsettled geopolitical tension in West Asia, weighing on returns from equities this year. However, the long term growth story would remain intact, with the government's push to improve rural consumption and infrastructure, and more foreign inflows expected to support the sentiment. 

Premiums on 25000-27000 call options of the Nifty 50 expiring Oct. 17 declined 3-14% and those on 25000-23100 put contracts fell 21-63%. The maximum addition of open interest was at 27950-point call and 25000-point put options. Traders added long positions in the October futures contract of the Nifty 50 expiring Oct. 31 and open interest rose 1.2% to 14.01 mln.

Analysts said foreign investors have been increasingly reducing their long positions in index futures, especially after the Securities and Exchange Board of India imposed restrictions on the weekly index expiry. The regulator's decision is aimed at reducing the trading volume in the futures and options market, where retail investors have burnt their fingers and made significant losses. Foreign institutional investors increased their short positions in index futures to 62% Wednesday from 57% Tuesday. However, these adjustments in positions do not indicate that FIIs are bearish on the market, analysts echoed. 

--Nifty 50 Oct closed at 25126.20, up 42.30 points; 127.75-point premium to spot index

--Nifty 50 Nov closed at 25271.50, up 41.10 points; 273.05-point premium to spot index

--Nifty 50 Dec closed at 25430.00, up 42.50 points; 431.55-point premium to spot index

Adani Enterprises, HDFC Bank, Reliance Industries, Tata Consultancy Services, Infosys, Kotak Mahindra Bank, ICICI Bank, Hindustan Aeronautics, Tata Motors, State Bank of India, Dixon Technologies, Lupin, Mahindra & Mahindra, HCL Technologies, Axis Bank, Larsen & Toubro, Tata Steel, and ITC were the most actively traded contracts.  End

Edited by Deepshikha Bhardwaj

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

Informist Media Tel +91 (22) 6985-4000

Send comments to feedback@informistmedia.com

© Informist Media Pvt. Ltd. 2024. All rights reserved.