FUTURES & OPTIONS

The derivative segment witnessed brisk and volatile trading during the week ended. After trading strong for better part of the week, Nifty Futures closed marginally weaker on Friday.

It is interesting to recall that correction of 475 points took 15 sessions, while the current rally of 520 points has been seen in just 10 sessions. Rallies getting bigger and faster signal a structural turnaround and positive bias in the index.

On the options front, the maximum open interest in put options is at 10,600 strike and maximum open interest in call options at 11,000 strikes. The Implied Volatility (IV) of calls closed at 10.61 per cent while that for put options closed at 10.20 per cent.

The Nifty VIX for the week closed at 12.51 per cent and is expected to remain sideways. True to predictions crossover of 10,775 levels with good volumes has propelled Nifty closer to its all-time high. Hold positions and add on declines say punters.

The week belonged to RIL which notched 12.5 per cent gains. Optimism about telecom business and plans to integrate Reliance’s consumer businesses with telecom and media are the biggest drivers behind the surge. Stay invested and buys on declines.

Bank Nifty too saw some cooling off and failed to close above its recent high of 27,058, which is the resistance while support is at 26,870-levels.

For the current momentum to get extended, Bank Nifty has to close above the 27,150 zone convincingly. Results of InduSind Bank were stable and industry players are expecting good numbers from Kotak Bank and HDFC Bank. Numbers of new generation banks Bandhan and RBL are reportedly good. Use corrections to buy.

NIFTY IT has closed in green by around 3.7 per cent amid strong results by TCS and strengthening dollar against rupee. Expectedly TCS earnings beat analysts’ expectations, whereas Infosys reported a mixed set of numbers for the quarter gone by. Stay invested for gains in Wipro, TechM and HCL Tech.

Stocks looking good are Apollo Tyres, Ashok Leyland, Britannia, Jubilant Foodworks, JSW Steel, KPIT Tech, Lupin, L&T and Marico.