FUTURES & OPTIONS

Ahead of the settlement week, derivative segment witnessed brisk trading and Nifty Futures managed to close at record highs for the fifth consecutive week.

Sentiment indicators like implied volatility, open interest, put/call ratio and VIX suggest only gains and consolidation from current levels. In the options segment highest open interest for Nifty in the current series is placed at 11,000 call option and 10,500 put option.

Bank Nifty has the highest open interest placed at 27,000 call option and 26,500 put option. Decisive move above 10,800 level could open up the next upside target of around 11,000/11,150 levels for Nifty, which could be achieved in the next 1-2 weeks.

Banks were the flavor of the week. Led by ICICI Bank, private banks like Axis Bank, HDFC Bank and Kotak Bank logged good gains. PSUs were laggards but are expected to move up in the next leg of rally of bank stocks. Buy SBI, BoB and PNB.

Results from HUL reflect the health of FMCG sector. Buy on declines HUL, Godrej Consumer, Dabur and Marico.

True to predictions, tech stocks are back in demand. Use corrections to buy Infosys and TCS. Below par results from Wipro were a dampener.

Q3 earnings of auto firms are expected to be strong due to low base. Buy Maruti Suzuki and Hero Motocorp.

RIL’s results were better than expectations. Market players expect positive response on Monday. Target of `1,150 is not ruled out.

Other stocks looking good are Coal India, Container Corp, Canara Bank, DHFL, ICICI Prudential, Jubilant Food, Kotak Mahindra Bank and NIIT Tech.