Equity Futures: Long bets added as Nifty 50 ends up for 3rd session

Equity Futures: Long bets added as Nifty 50 ends up for 3rd session

Informist, Thursday, Jan 11, 2024


By Padmini Dhruvaraj


MUMBAI – Investors added long bets at 21600-21700 strike prices of the call options that expired today as the Nifty 50 extended its gaining streak for the third straight session. However, put addition at 21600-21700 strikes also rose after the spot index fell off the intraday highs.


The benchmark index opened higher tracking positive sentiment from the global equity markets, but fell off its highs due to losses in information technology and fast-moving consumer goods stocks. Eventually, the 50-stock index ended 0.1% higher at 21647.20 points, aided by gains in shares of Reliance Industries and automobile companies. 


"Indian equity indices opened with a gap up but lost some gains during the day to still end slightly in the green during cautious trade on Thursday (today) as investors awaited earnings from IT majors as well as the latest readings on industrial output and retail inflation for directional cues," Avdhut Bagkar, a technical and derivatives analyst at StoxBox said.


In the options chain that expired today, the 21650 strike had the most open interest addition with 30 mln new contracts, while the 21600 strike on the put options had a net open interest addition of 14.8 mln.


Meanwhile, the open interest spread across the contracts expiring on Jan 18 indicated a slight positive momentum in the market. Fresh long bets were added even at a few deeper out-of-the-money strike prices of the call options. The 22300 strike of the call options had the most net open interests today, while the 21700 strike had the second-highest open interest addition. 


On the put side, the 21500 strike price was among the top contracts with the most open interest addition. Additionally, aggressive put options selling was seen at 21000, 20800, and 19700 strike prices.


The January futures contract of the Nifty 50 closed at a premium of 42.65 points to the spot index. Open interest in the contract rose 2.7% to 11.8 mln, according to provisional data.


Going forward, analysts expect the Nifty 50 to consolidate at the current level and pick a direction based on the Oct-Dec earnings by companies. "Nifty 50 has been hovering in a range for almost two weeks now and a mixed trend in index majors is not offering any clear signal over the next directional move," Ajit Mishra, a senior vice president of technical research at Religare Broking said. "We feel participants should prefer hedged positions, with the beginning of the earnings season and wait for clarity," he added.


The Nifty 50 is expected to find support at 21500-21450 points and face resistance at 21700 points. "For the bulls now, 21750 would be the immediate breakout level," Shrikant Chouhan, head of equity research at Kotak Securities said. "Post breakout, the market could rally till 21835-21875," he added.


--Nifty 50 Jan closed at 21689.85, down 19.25 points; 42.65-point premium to spot index

--Nifty 50 Feb closed at 21832.00, down 11.45 points; 184.80-point premium to spot index

--Nifty 50 Mar closed at 21950.00, down 16.45 points; 302.80-point premium to spot index


Reliance Industries, Polycab India, Infosys, Tata Consultancy Services, Tata Power, Hero MotoCorp, Bajaj Auto, Axis Bank, Dr Reddys Laboratories, and Hindustan Unilever were the most actively traded underlying stocks.  End


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


Edited by Akul Nishant Akhoury


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