More Stories

Informist, Thursday, Aug. 20, 2026

 

By Eshitva Prakash

 

MUMBAI – Traders bought call options at select out-of-the-money strike prices of the Nifty 50 derivatives chain after the headline index snapped a seven-session losing run. This rise in the underlying index was supported by a sharp decline in US Treasury yields after the US treasury department Wednesday said it would double the size of its debt repurchases, mainly at the long end of the yield curve. However, elevated crude oil prices, whose futures contracts rose to a near one-month high, spoilt market sentiment, leading to premiums on some call options declining sharply from the day's highs and suggesting expectations of only a limited rise in the market. 

 

On Thursday, the Nifty 50 ended at 24231.85 points, up 0.6% from Wednesday. The August futures contract of the Nifty 50 closed at a premium of 58.65 points to the spot index and open interest at this position of over 7% from Wednesday to around 11.99 million, primarily due to short covering by call writers. Eternal was the top gainer among Nifty 50 constituents. Financial services companies such as Kotak Mahindra Bank, Bajaj Finance, Shriram Finance, Axis Bank, and HDFC Life Insurance Co. ended 1–2% higher. 

 

The 24500 strike price had the highest call base, but open interest in the contract declined by over two million to nearly 13 million. Call writers, who had enjoyed high returns from the Nifty 50's seven-day decline, were forced to cover their short positions, leading to a fall in open interest. However, the contract ended at INR 23.10, significantly lower than its intraday high as oil rates surged, indicating long unwinding as well. 

 

Premiums of call contracts at the 24200–24450 strike price rose 50–90% and those at the 24550 strike price rose nearly 18%, albeit at a relatively low delta. Further out-of-the-money call contracts continued to be sold. "I suggest traders adopt a bull-call spread," Jatin Gedia, vice-president of technical research at Teji Mandi Investment Technologies said. He advised buying call options at the 24200 strike price and selling call options at 24500 strike price. 

 

On the other side of the options chain, the 24000 strike price had the highest put base, followed by 24200. These levels indicate where the 50-stock index will find strong and immediate support, respectively. Gedia said he expects the Nifty 50 to find support at 24200 level and face resistance at 24500 points.     

 

Traders were reluctant to add to their long positions in the Nifty 50 chiefly because of another sharp rise in crude oil prices. Transit through the Strait of Hormuz remained low amid opposing claims from the US and Iran. US President Donald Trump Tuesday said no talks were taking place between the two nations and that the strait was open, while Iran said the waterway remained closed. Commodity vessel crossings at the strait totalled nine Wednesday, unchanged from Tuesday, data from website Kpler showed. At 1610 IST, the October futures contract of Brent Crude oil traded 2.5% higher at $93.88 per barrel on the Intercontinental Exchange. 

 

US Treasury Secretary Scott Bessent said the department would more than double its buybacks of 10- to 30-year debt, to at least $4 billion per operation from $2 billion, over the next two months.

This move sent yields tumbling, with the 30-year bond yield falling more than 10 basis points compared to the previous session and the 10-year note yield falling more than 6 basis points. Treasury yields have been pushing steeply higher since June, and the 30-year government bond's yield touched levels not seen since before the 2008 global financial crisis.

 

"Investors read the buyback increase as easing near-term borrowing-cost pressure, more broadly, as a signal of Bessent's ongoing effort to bring down yields across maturities — countering recent worries over heavy AI (artificial intelligence)-related borrowing, inflation, and the fiscal deficit," Devarsh Vakil, head of prime research at HDFC Securities, said in a note.

 

--Nifty 50 August closed at 24290.50, up 172.90 points; 58.65-point premium to the spot index
--Nifty 50 September closed at 24399.00, up 160.20 points; 167.15-point premium to the spot index
--Nifty 50 October closed at 24515.00, up 138.00 points; 283.15-point premium to the spot index

HDFC Bank, ICICI Bank, Axis Bank, Tata Consultancy Services, Reliance Industries, Infosys, Bharti Airtel, JSW Steel, Hindalco Industries, and Bajaj Finance were the most actively traded underlying stocks Thursday.  End

 

US$1 = INR 95.71

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT

 

Edited by Avishek Dutta

 

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. 2026. All rights reserved.