Informist, Thursday, Jul. 3, 2025

By Anjana Therese Antony

MUMBAI – The derivatives chain of the Nifty 50 hints at muted movement for the spot index in the near term in the absence of key triggers. While the bias towards the domestic market remains bullish, uncertainty around US tariffs and trade deals are likely to keep the market gains in check in the near term, analysts said. Premiums across call options and on most put contracts declined, with no aggressive addition of open interest on either sides. 

"We are in a buy on dips market till we are holding above 25100-25000 spot levels," said Vipin Kumar, assistant vice president and senior derivatives analyst at Globe Capital Market. The market is waiting for fresh triggers and the US-India trade deals will likely work as a catalyst for fresh move, Kumar said. Resistance for the index is seen around 25600-25800 levels, he added. The Indian equity market extended its losses for the second consecutive session Thursday and closed marginally higher. The Nifty 50 and the BSE Sensex ended 0.2% lower each at 25405.30 points and 83239.47 points, respectively.

The market had initially cheered the US' trade deal with Vietnam ahead of the deadline for the pause in reciprocal tariffs announced in April. However, it then fell as investors booked their profits amid elevated uncertainty about the next leg of tariffs. While periodic corrections are likely, research analysts are optimistic that the market will continue to rise amid rising favour towards strong emerging markets due to the uncertainty around tariffs in the US.

They also said that the US will continue to face challenges in terms of risks associated with tariffs that could hurt its economic growth and push inflation. The domestic market has recovered the fall caused by the flip-flops of tariffs and the tension in West Asia. As the conflict between Iran and Israel de-escalated, global crude oil prices eased significantly, providing some comfort to investors. 

In the options chain of the Nifty 50, premiums on call options 25400-26400 strikes prices expiring next week declined 19-33%, while those on 25400-25300 increased just 2-3%. Premiums on most other put contracts fell. Traders also refrained from making aggressive bets to the futures series of the Nifty 50. The July contracts of the Nifty 50 closed 0.2% lower at 25500 level and open interest rose 0.4% to 14.14 million. A similar trend was also seen for the August and September contracts. 

"FIIs are the only participant having short positions (in index futures). Long short ratio is 0.5," Kumar said. "They have 2 short positions against every long positions as on Wednesday," he added. 

--Nifty 50 Jul closed at 25500.00, down 46.10 points; 94.70-point premium to the spot index

--Nifty 50 Aug closed at 25609.80, down 41.00 points; 204.50-point premium to the spot index

--Nifty 50 Sep closed at 25760.00, down 48.20 points; 354.70-point premium to the spot index

ICICI Bank, HDFC Bank, Reliance Industries, Avenue Supermarts, BSE, Tata Steel, State Bank of India, Bajaj Finance, Vedanta, Punjab National Bank, Bharat Electroncis, Kotak Mahindra Bank, InterGlobe Aviation, and Hindustan Aeronautics were the most active underlying stocks Thursday.  End

Edited by Akul Nishant Akhoury

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