Markets regained its lost momentum by posting a mammoth rally after witnessing a consecutive negative close on EOE basis. Nifty PSU Bank rallied ~31%, posting highest gains since its inception in 2011. PNB was the biggest gainer on account of recapitalization scheme announcement. Nifty and Bank Nifty index rallied ~5.8%/4.2% higher on account of continued long build-up. Long gamma positions were the flavour of the series as the indices posted a movement of ~580/~1174 points. Implied volatility measured by the India Vix index tumbled ~11% as the geopolitical tension eased.
DII's & FII's continued to remain on the opposite side of the trades for the third month in a row with DII's pumping in a buying figure to the tune of ~Rs 9.8k Cr and FII's pulling out ~Rs 6k Cr. FII's index future long/short ratio hovered around ~1.5x throughout the series, posting a marginal recovery after falling below the ~1x levels at the start of the series.
Rollovers of Nifty/Bank Nifty stood at 73%/69% (2.31Cr/17.4 lakh shares) as against 70%/65% (2.05Cr/22.1 lakh shares). Rollovers for Nifty were higher in terms of percentage as well as total open interest vis-a-vis last month and last three-month average. Based on analysis of the mentioned data, on account of rollover of long positions, we expect Nifty to continue its upward momentum upto the immediate resistance level of 10,500. On the options front, September series starts with the maximum open interest in put options at 10,000 strike (4.4mn shares) and maximum open interest in call option at 10,500 strike (2.7 mn shares).
Stocks to watch out - November expiry
: TORNTPHARM, INFRATEL, AJANTPHARM, GODREJCP & BRITANNIA
: HCLTECH, AXISBANK, RCOM & EQUITAS