Equity Futures
Traders expect slow-moving market but sentiment positive
This story was originally published at 18:45 IST on 31 July 2026
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MUMBAI – Traders continued to sell out-of-the-money put options and purchased some near-the-money call options on the Nifty 50, the options chain showed. While hefty put writing activity continues to fuel expectations of a further rise, low implied volatility across out-of-the-money contracts and a large open interest build-up around spot levels indicates range-bound movement for the headline index.
Friday, the Nifty 50 ended 0.3% higher at 24383.60 points. Financial services companies such as Bajaj Finance, Bajaj Finserv, and Jio Financial Services led the rise in the benchmark index. A rise in upstream and downstream oil stocks also supported the index while information technology stocks were the biggest drag. Renewed optimism over the artificial intelligence trade halted the breakneck rally in the Nifty IT index.
Iran's military said it struck and stopped two oil tankers trying to pass through the Strait of Hormuz earlier Friday. It accused them of "violating" Iran's protocol by trying to use an unauthorised route through the waterway. Iran claimed the tankers were receiving aerial escort from the US military and were stopped after ignoring its warnings, the Fars news agency reported. The renewed military conflict in West Asia has raised concern that crude oil prices will rise again, adding to the inflationary pressure on countries heavily dependent on crude oil imports. At 1621 IST, the September futures contract of Brent Crude was up 0.7% at $89.67 per barrel.
Accelerating theta decay forced traders to sell deep-out-of-the-money call options. However, some traders also bought near-the-money call options around 24400-24450 strike prices, with premiums across these contracts rising sharply. The highest open interest at the 24600 strike price on the call side indicates the level will act as a resistance for the headline index. A decline in open interest at the 24500 strike price showed some traders unwound their long positions before the options contract expires in two more sessions.
Traders continued to aggressively write put options. Premiums across 24000-24300 strike prices declined over 50% and implied volatility remained subdued. Vega across these options rose to INR 5-INR 9. Some traders purchased further out-of-the-money put options as a hedging strategy. Looking at the chart structure, the Nifty 50 is likely to find support at 24200 points and face resistance at 24700-24800 points, Rupak De, senior technical analyst at LKP Securities, said.
"Some support from Bank Nifty (banking sector index) will put bulls in charge and provide further upside for the Nifty 50," De said. The analyst sees further market gains being contingent upon whether the Nifty Bank manages to cross the 57500-point level, in which case it can rise 1000 points more in short order. Until then, select information technology, metal, automobile, and realty stocks will lend support to the market, he said.
Traders sold deep-out-of-the-money contracts across the options chain of the Nifty Bank index. Some near-the-money call options across 57300-57400 strike prices were purchased, indicating hopes of small gains. Traders also wrote expensive put contracts across 55000–57000 strike prices and premiums across these declined 17-24%.
--Nifty 50 August closed at 24430.00, up 72.00 points; 46.40-point premium to the spot index
--Nifty 50 September closed at 24560.60, up 86.30 points; 177.00-point premium to the spot index
--Nifty 50 October closed at 24680.00, up 71.40 points; 296.40-point premium to the spot index
Bajaj Finance, Mahindra & Mahindra, Infosys, Reliance Industries, Swiggy, Jio Financial Services, Tata Consultancy Services, HDFC Bank, Sun Pharmaceutical Industries, and Eternal were the most actively traded underlying stocks Friday. End
US$1 = INR 95.38
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Rajeev Pai
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