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Informist, Wednesday, Mar. 11, 2026

 

By Gopika Balasubramanium

 

MUMBAI – Traders bought deep out-of-the-money put options throughout the session, indicating there are expectations of a steep fall in the Nifty 50 index, and premiums of those put contracts jumped. Traders also sold out-of-the-money call options, implying a likelihood of a near-term market decline. 

 

Traders are concerned about the extent of the repercussions of higher crude oil prices and a chokehold at the Strait of Hormuz on economic growth. The war in West Asia has entered its 12th day, with no indication of an end as both parties continue to carry out military attacks. 

 

Wednesday, the Nifty 50 ended at 23866.85 points, down 394.75 points or 1.6%. The index is currently 9.5% down from the all-time high of 26373.20 points it hit in early January. Analysts do not expect the index to bounce back to levels near a lifetime high, even on a ceasefire in West Asia, due to a subdued demand environment in India. Some analysts also expect a revision of earnings estimates for the next financial year if crude oil prices remain at higher levels, especially around $90-$100 per barrel. 

 

Many market participants predicted a decline in earnings for crude-linked sectors if prices remain elevated for an extended period. Some analysts had also pointed out that the equity market may not see fresh inflows at this point, and investors would wait until the war ends before deploying capital. However, they also feel the ongoing market correction may open attractive entry points and make valuations cheap. 

 

Derivatives analysts also believe investors would likely refrain from taking long positions in the near term. They also feel that the volatility in the market is too high and fresh bets will be added only when there is some stability in the market movement. Technical analysts expect the Nifty 50 to remain under selling pressure as long as it remains below 24000 points. 

 

Traders sold immediate out-of-the-money call contracts at 24000-24500 strikes and their premiums fell 54-64%. This indicates that a sharp rise in the Nifty 50 is unlikely and the selling pressure is likely to stay. The highest concentration of call contracts was at 26000. The maximum addition of open interest in call was seen at 25200, followed by strike prices 24300 and 24200. 

 

Meanwhile, traders bought extreme out-of-the-money put contracts, signalling negative market sentiment. They bought put contracts at strikes such as 21500, 21450, 22700, and 22000, which indicates expectations of a steep market decline. Premiums of 23000 put options jumped 153% and those of 22700 surged 143%. The highest concentration and maximum addition of open interest was at 23000 put.               

 

--Nifty 50 March closed at 23918.00, down 475.60 points; 51.15-point premium to the spot index

--Nifty 50 April closed at 24077.40, down 468.20 points; 210.55-point premium to the spot index

--Nifty 50 May closed at 24202.00, down 468.00 points; 335.15-point premium to the spot index

 

Reliance Industries, HDFC Bank, Axis Bank, Dixon Technologies (India), ICICI Bank, InterGlobe Aviation, Bharti Airtel, State Bank of India, Vedanta, Polycab India, Tata Consultancy Services, Bajaj Finance, National Aluminium Co., Infosys, Shriram Finance, Wipro, and Colgate Palmolive (India) were the most actively traded underlying stocks Wednesday.  End

 

US$1 = INR 92.04

 

Edited by Saji George Titus

 

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