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Informist, Monday, Aug. 18, 2025

 

By Akash Mandal

 

MUMBAI – Options data show the benchmark Nifty 50 is unlikely to sustain above the 25000-point level in the near term despite the buoyant sentiment in the market. Monday's strong gains, aided by positive sentiment about a planned rejig of the goods and services tax, were a knee-jerk reaction helped by traders seizing the opportunity to cover some of their short positions, analysts said.

 

On the call side, the highest addition of open interest was at the 25000 strike price, with the contract also seeing the highest addition of open interest during the session. Whilst traders also bought the 25100-25600 call contracts, implying that the 50-stock index might rise further once it gets past the 25000-point mark, the open interest at the 25000 strike price was nearly 1.5 million more than at the 26000 call contract, which had the second highest open interest. Traders heavily sold the 26000 call contract.

 

There was short-covering across in-the-money strike prices, implying that the Nifty 50 is unlikely to fall sharply from the current levels even in case of a brief pull-back. This short-covering aided the Nifty 50 to end nearly 250 points higher at 24876.95 points. The index briefly crossed the 25000-point mark intraday after nearly a month but failed to sustain itself above that level.

 

Some analysts expect the GST reforms to be a pivotal trigger for the market, helping to boost consumption and ultimately boost earnings growth across sectors. Emkay Global Financial Services raised its target on the Nifty 50 to 28000 points for September 2026 from the earlier estimate of 26000 points for March as it sees the GST rationalisation as growth-accretive and a major market mover. 

 

However, other analysts remain cautious and await concrete details of the changes in the tax. There need to be multiple triggers for the Nifty 50 to claw back to its lifetime high, they said. These triggers would include further rate cuts by the RBI, ending of tariff-related uncertainties, and, most importantly, a notable improvement in earnings growth.

 

On the put side, traders sold contracts across the board, with the maximum addition of open interest at the 24800 and 24900 strike prices. While the highest open interest was still at the 24000 strike price, analysts do not expect the Nifty 50 to fall sharply from the current level.

 

--Nifty 50 Aug closed at 24971.60, up 286.90 points; 94.65-point premium to the spot index

--Nifty 50 Sept closed at 25115.60, up 293.10 points; 238.65-point premium to the spot index

--Nifty 50 Oct closed at 25232.40, up 295.50 points; 355.45-point premium to the spot index

 

Maruti Suzuki India, Hero MotoCorp, Bajaj Finance, HDFC Bank, Mahindra & Mahindra, Reliance Industries, TVS Motor Co., Infosys, Tata Motors, ICICI Bank, Bharti Airtel, Bajaj Auto, Eternal, Trent, and State Bank of India were the most active underlying stocks Monday.  End

 

Edited by Rajeev Pai

 

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