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Informist, Thursday, Feb. 5, 2026

 

By Simran Rede

 

MUMBAI – After India signed a trade deal with the US, caution prevailed in the market with the Nifty 50 consolidating for the third consecutive session. Traders aggressively wrote call options of Nifty 50 derivatives, while short-covering in the market eased down for the second day. Analysts believe the short covering by foreign investors was on positive sentiment due to the trade deal and does not have any fundamentally positive factor for them to return their investment in India.

 

Thursday, the Nifty 50 took a breather from its three-day rising streak, when it gained 3.8%. The index closed 0.5% down at 25642.80 points. Investors booked profits Thursday after the recent rally triggered by optimism over the India–US trade deal. The BSE Sensex closed 0.6% lower at 83313.93 points. Although the index fell Thursday, analysts maintain their bullish bias as long as the index stays above 25500 points.

 

In the options chain of the Nifty 50, premiums on out-of-the-money call options fell 48-60% on 25700-26000 contracts. The open interest in each of these contracts rose over 5 million. Premiums on put contracts between strike prices 25000 and 24900 declined 22-26% with the open interest rising 1 million-3 million.

 

The put writing seen Thursday was limited, indicating caution on the upside. The immediate support for the Nifty 50 is placed at 25450–25500 points while the resistance is seen at 25800 and 26000 points, Vatsal Bhuva, technical and derivatives analyst at LKP Securities, said. The put-call ratio is at 0.6, signalling a mildly bearish undertone, he said.

 

Thursday, the highest addition of open interest was at 25700 call options expiring Tuesday and 24850 put contract. The maximum concentration of open interest was at 26000 call contract and 25000 put strike. 

 

The open interest in the February futures contract of Nifty 50 rose 2% to 15.78 million with the contract falling 0.5% to 25720 points. The February contract closed at a premium of 77.20 points to the spot index Thursday. The March and April contracts also rose 2.3% and 2.8%, respectively.

 

Market participants will keep a close eye on the Reserve Bank of India's monetary policy outcome, scheduled Friday at 1000 IST. Volatility in the market is likely to remain high amid uncertain global cues. Analysts suggest the current breather should be viewed as a buy-on-dips opportunity.

 

--Nifty 50 February closed at 25720.00, down 128.80 points; 77.20-point premium to the spot index
--Nifty 50 March closed at 25877.80, down 135.30 points; 235.00-point premium to the spot index
--Nifty 50 April closed at 26033.00, down 129.70 points; 390.20-point premium to the spot index

 

Hindustan Aeronautics, Infosys, Trent, Multi Commodity Exchange of India, PB Fintech, Dixon Technologies (India), Bharti Airtel, Vedanta, Cummins India, Power Finance Corp., State Bank of India, Axis Bank, Hindustan Zinc, Kotak Mahindra Bank, ICICI Bank, Tata Consultancy Services, Reliance Industries, and Tata Steel were the most actively traded underlying stocks Thursday.  End

 

Edited by Deepshikha Bhardwaj

 

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