More Stories

Informist, Monday, Feb. 24, 2025

By Anshul Choudhary

MUMBAI – Traders added short positions and closed their long positions as the Nifty 50 fell below its intraday support level, falling for the fifth straight session. Tariff threats from US President Donald Trump and uncertainty around a bounceback in earnings growth, continued to hit market sentiment.

The Nifty 50 closed at 22553.35 points, down 1.1%, and significantly lower than Monday's support level of 22700-22650 points. The Nifty 50 has already fallen over 4% so far this month. This pushed traders to sell call options and buy in-the-money put options.

A sharp fall in US markets last week was being touted as a major reason behind the weak sentiment on Monday. Shares of information technology companies fell in tandem with US stocks as possibility of further tariffs by the Trump administration have raised fears of higher inflation in the world's largest economy. This has hurt expectations of sharper cuts in interest rates in the US, which would delay recovery in discretionary spending, analysts said.

Lately, stocks in the US have faced selling pressure but those outflows are moving to China and some European markets due to their relatively better valuations compared to Indian markets, analysts said. High valuations of Indian markets, at a time when earnings growth has seen a slowdown, is preventing foreign investors from returning to Indian markets for now, analysts said. 

Due to these concerns, traders sold call options of the Nifty 50 strike prices expiring Thursday. The highest addition of open interest was at 22600 calls and the highest open interest was at 22800-23000 strike prices. While most analysts expect the Nifty 50 to fall more, they have not rejected the possiblity of slight bounce-back as the Nifty 50 is in oversold zone on technical charts. In case of gains, analysts expect the Nifty 50 to first face resistance at 22600-22650 levels, followed by 22800 points.

On the put side, traders bought in-the-money and at-the-money put options with highest open interest at 22500 strike prices, followed by 22000 strike prices. Options data showed that traders closed their long positions across in-the-money put options. 

The February futures contract of the Nifty 50 closed at a premium of 50.65 points to the spot index. Open interest in the contract fell 23% to 11.66 million, according to provisional data.

--Nifty 50 Feb closed at 22604.00, down 218.60 points; 50.65-point premium to spot index
--Nifty 50 Mar closed at 22735.00, down 228.05 points; 181.65-point premium to spot index
--Nifty 50 Apr closed at 22886.10, down 219.05 points; 332.75-point premium to spot index

End

Edited by Tanima Banerjee

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. 2025. All rights reserved.