The Nifty marked a fresh life above its impending resistance mark of 12,100, as the November series ended with a positive traction of more than 2 percent, and the strong rollover seen for the December series for the Nifty Bank suggests that banking stocks will remain in focus, according to a report.
Buoyancy in sentiments is seen as heavyweights such as Reliance Industries and ICICI Bank were leading from the front to push the index to record highs.
Highlights for the series include: a) The Bank Nifty index was up 6.8 percent (expiry to expiry), outperforming the Nifty, b) India VIX remained below 15 mark c) Massive short covering on index futures seen from FIIs at the fag end of expiry days, and d) Options writing trades remained lucrative, as markets traded in a narrow band with low implied volatility.
Rolls for the Nifty and the Bank Nifty stood at 79 percent, and 70 percent compared to 84 percent and 63 percent in the previous month.
Aggressive long buildup with a sharp increase in open interest (OI) base was seen on the Bank Nifty led by ICICI Bank. The market-wide rollover was better than the previous month at 93 percent, compared to the 3-month average of 92 percent.
Foreign institutional investors (FIIs) positioning on the index futures’ long to short ratio stood at 1.54x. FIIs’ long index rollovers stood at 75 percent, compared to 3-month average of 67 percent along, unwinding on short positions was also seen.
“Maximum call/put OI on the Nifty for December monthly series stands at 12,500 calls (1.7mn) and 12,000 puts (OI 3mn). We expect a continuation of the rally, with mild periodic profit booking,” said the Yes Securities report.
Sectors that saw strong rollovers include banking, metals, and infra, with weak trends seen on capital goods, media and cement stocks.
Strong rollover was seen in stocks such as Torrent Power, JSW Steel, Container Corp, ACC, Bajaj Auto, Axis Bank, Godrej Consumer Products, MRF, Asian Paints and United Spirits.
Weak rollovers were seen in stocks like ONGC, Chola Finance, Voltas, Vedanta, Eicher Motors, Page Industries, NALCO, TVS Motor, Shree Cement, and Vodafone Idea.
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