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Informist, Wednesday, Sept. 30, 2026

 

By Eshitva Prakash

 

MUMBAI – Traders purchased out-of-the-money put contracts on the derivative chain of the Nifty 50 index, indicating expectations of a further decline. The headline index tested its 22600 support as crude oil prices whipsawed, and overall market breadth worsened during the final hours of trading. Traders also continued to sell call contracts across the options chain of the index, indicating limited possibility of recovery in the near term.

 

The premium of the put contract at the 22500 strike price rose over 37% to INR 80.75. Open interest at this position rose by 2.60 million contracts to 6.66 million. Further out-of-the-money contracts across 22200-22300 strike prices were also purchased, with premiums rising up to 9%. Open interest on various in-the-money put options declined as traders took profits and unwound long positions. The highest put base at the 22000 strike shows long-term support for the Nifty 50 and large open positions at 22500 strike indicate where the index will find immediate support. 

 

A decisive fall below 22550–22500 points will likely trigger fresh selling pressure towards 22350 points, Sudeep Shah, vice-president of technical and derivatives research at SBI Securities, said. The 22790–22810 range will act as an immediate hurdle for the Nifty 50, a sustained move above which, will likely extend recovery towards 22950 points, the analysts said. Shah added that the broader structure remains weak, and sustained buying traction would be required for a meaningful recovery.

 

Options data points towards a bleak outlook for October as deep-in-the-money put options--marked for monthly expiry--were in demand Wednesday. The premium of the put contract at the 22000 strike rose more than 22% to INR 100. Some traders also purchased relatively lower delta contracts as far out-of-the-money as the 21000 strike. Premiums across the 21000-21500 strike price rose up to 22%. The Nifty October futures contract ended at 22700 points, down 165.70--indicating a premium of just 79.55 points to the spot index. Tuesday, the contract had ended at a premium of 177 points to the spot index.

 

Reinforcing this bleak view, traders relentlessly sold contracts on the other side of the options chain. The highest call base at the 23000 strike price shows heavy selling activity, with open interest at the position rising by more than 5 million contracts to 11.78 million. Premiums across 23000–23500 strike prices declined 40–60%. Closer-to-the-money call contracts were also sold, with premiums across 22700-22900 strike prices declining 50–60%.

 

On Wednesday, the Nifty 50 ended at 22620.45 points, down 0.4% from Tuesday. Some private sector banks and information technology companies rose, preventing a steeper decline. Meanwhile, traders booked profits in healthcare and pharmaceutical-related stocks, which put pressure on the headline index. The index declined 6.1% this month, marking its worst performance in September since 2018. This month, the November futures contract of Brent Crude oil has risen more than 14%. At 1620 IST, the contract traded at $103.27 per barrel on the Intercontinental Exchange, up 0.7% from Tuesday.

 

"September was a month of heightened volatility for Indian equities, with the Nifty 50 and Sensex correcting around 6% as elevated crude oil prices, rising global bond yields and persistent FII (foreign institutional investor) selling weighed on sentiment," Agrim Verma, co-founder and director of Divitiae Analytics, said. "In the near term, we expect volatility to remain elevated, particularly if crude oil stays at these levels and inflationary pressures broaden," Verma said.

 

--Nifty 50 October closed at 22700.00, down 165.70 points; 79.55-point premium to the spot index

--Nifty 50 November closed at 22826.60, down 152.70 points; 206.15-point premium to the spot index

--Nifty 50 December closed at 22955.00, down 99.00 points; 334.55-point premium to the spot index

 

HDFC Bank, BSE, ICICI Bank, Reliance Industries, Apollo Hospitals Enterprise, Infosys, Kotak Mahindra Bank, Bharti Airtel, Max Healthcare Institute, Axis Bank, and State Bank of India were the most actively traded underlying stocks Wednesday.  End

 

US$1 = INR 95.83

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

 

Edited by Avishek Dutta

 

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