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Informist, Thursday, May 7, 2026

By Gopika Balasubramanium

MUMBAI – Traders cut their call positions and dragged the Nifty 50 to end flat Thursday. This was in contrast to Wednesday when traders bought far out-of-the-money call options, hoping for a rise in the index. Thursday, traders wrote contracts on both the put and call sides, indicating a rangebound movement in the Nifty 50. Some derivative analysts said traders opened options positions on State Bank of India ahead of the lender's quarterly results due Friday. 

The Nifty 50 ended at 24326.65 points, down 4.30 points. The index was largely choppy throughout the session, moving in a range of nearly 200 points. Among the broader market indices, all the three mid-cap indices hit record highs during the day. This is at a time when the headline index is still 8% away from the record high it hit in early January.                        

"Since SBI (State Bank of India) is announcing March quarter results on Friday, traders hedged their open positions by selling future contracts that led to premium decline or spread decline in SBIN," said Vipin Kumaar, assistant vice president – technical and derivatives at Globe Capital Market. This activity has affected the premium for both Nifty Bank and Nifty 50 indices, Kumaar said.  

The options chain of SBI indicates that traders have sold call contracts and the most short bets were added at INR 1,110. On the other hand, traders bought put contracts at out-of-the-money strikes across the board, but most bets were at a strike price of INR 1,110, with a 39% rise in premium. These bets indicate that the stock will likely face pressure at higher levels.

The lender is expected to report a 4% rise in its net profit for the March quarter to INR 193.98 billion, an average of 12 brokerage estimates showed. Kumaar expects the stock to trade between INR 1,060 and INR 1,140 Friday. The stock ended at INR 1,092, down 0.4% from Wednesday.  

Thursday, premiums in near out-of-the-money call contracts of Nifty 50 at strikes such as 24400 and 24500 declined 23-26%. The premium of far out-of-the-money saw a slightly sharper fall at 39-45%, at 25100 call and 25400 call. The highest addition of open interest was at 24400 call and the highest concentration was at 24500. This indicates the upside is capped at such higher levels.      

Meanwhile, on the put side, traders wrote contracts across the board, but the highest number of bets were at the 23500 strike. This indicates that the index is unlikely to fall below this level. The premiums on this strike price fell around 52%. However, the premium for the strike price of 24300, which saw the second most addition of contracts, fell only 8%, indicating that the index will take support at that level. The highest addition as well as concentration of open interest was seen at the 23500 put.

--Nifty 50 May closed at 24405.00, down 42.40 points; 78.35-point premium to the spot index

--Nifty 50 June closed at 24501.60, down 43.30 points; 174.95-point premium to the spot index

--Nifty 50 July closed at 24636.00, down 47.80 points; 309.25-point premium to the spot index

Bharat Forge, HDFC Bank, Polycab India, Bajaj Auto, ICICI Bank, Bharat Heavy Electricals, Coal India, State Bank of India, One 97 Communications, BSE Ltd., HDFC Life Insurance Co., Hero MotoCorp, Mahindra & Mahindra, CG Power and Industrial Solutions, Laresen & Toubro, Kotak Mahindra Bank, Reliance Industries, PB Fintech, and KEI Industries were the most actively traded underlying stocks Thursday.  End

Edited by Pankaj Aher

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