Indian benchmark indices are trading lower due to profit booking after reaching new all-time highs earlier this week. Foreign Institutional Investors (FIIs) have turned bullish on Indian markets, with the Long-Short Ratio (LSR) improving to 54:46 in the index futures.
Volatility remains high, with the India VIX hovering above 24, and it may cool in the coming days, according to Soni Patnaik, Assistant Vice President of Derivative Research at JM Financial.
Nifty, Bank Nifty rollover analysis
Rollover analysis shows that the Bank Nifty rollovers so far (till May 28) were at 51 percent with a roll cost of 0.7, compared to 56 percent in the last series. Bank Nifty is set to expire later today and Nifty index monthly derivatives expiry is due on Thursday, May 30.
Nifty rollovers have moderately increased from the previous month to 49 percent at the end of May 28, with a 0.5 roll cost, compared to 47 percent at the same time in the last series, according to JM Financial.
Soni Patnaik of JM Financial said that the rollover data showed fewer rollovers, indicating that long positions are being booked. She advised investors to maintain caution.
Highest sectoral rollovers
According to Patnaik, the sectors with the highest rollovers are:
Capital Goods: 65 percent
Media: 61 percent
Metals: 61 percent
Finance: 59 percent
Highest stock rollovers
Patnaik also highlighted stocks with the highest rollovers:
Berger Paints: 78 percent
ICICI Prudential: 72 percent
Jubilant FoodWorks: 72 percent
ICICI Lombard: 68 percent
HDFC Bank: 70 percent
Havells: 73 percent
SAIL: 80 percent
Index views
Bank Nifty has seen the highest Open Interest (OI) at 49,500 Call Option (CE) and 49,000 Put Option (PE), each with more than 1.8 lakh contracts. "Overall, the highest OI continues to be at 50,000 CE, acting as a crucial resistance for the May series finale and the opening of the June series. The expiry range for Bank Nifty for the May series is expected between 48,800 and 49,300," said Patnaik.
Also read: F&O manual| Indices trade lower; Nifty trading near crucial support of 21,700
"Nifty sees the highest immediate OI at 23,000 CE. The expected range for the May series (expiry) is 22,700 to 23,000," she added.
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