Going into the December series, foreign institutional investors (FIIs) were seen increasing their bearish bets, indicating nervousness about the market direction. Analysts said it was likely the Reserve Bank of India (RBI)’s policy review scheduled for Tuesday and announcement of the quarterly and annual data on growth in gross domestic product (GDP) had made investors cautious.
“In the past two days, FIIs have been taking short positions, going into the next expiry. This is different from the previous expiry sessions, when FIIs were seen taking long positions…While there is nothing alarming, it remains to be seen whether the positive momentum we have been seeing in the market will continue or not,” said Hemant Nahata, senior research analyst, IIFL.
Analysts said foreign investors preferred booking profits during this period, as December-end was a time for account-closing and holidays.
Nervousness was also seen in open interest positions in the banking sector, which were much lower, particularly for public sector undertakings (PSUs). “Stock-specific action was seen through the entire month. In the banking space, private and large-cap PSU banks gained, while smaller PSU banks remained under pressure,” said Sahaj Agrawal, deputy vice-president (derivatives research), Kotak Securities.
Analysts said open interest in PSU banks continued to be lower than 60 per cent, falling to 50 per cent in some cases. “The market is not able to make up its mind about PSU bank stocks. A high rollover percentage in PSU banks is missing despite the fact that some of these stocks have hit 52-week highs,” said Nahata.
Open interest in private sector banks had been dropping steadily, derivatives experts said. The sharp run-up in stocks such as YES Bank, Axis Bank and IndusInd Bank was prompting traders to reduce long positions, resulting in lower rollovers, analysts said.
On the stock futures front, analyst said going into the December series, the open interest was strong, with a hint of uncertainty, as only select stocks within a particular sector saw sharp rollovers.
For the Nifty, the ‘call’ concentration was highest at 8,500-levels, while the ‘put’ concentration was the highest at 8,000. Analysts said this could indicate higher volatility in the Nifty during December.
“In the past two days, FIIs have been taking short positions, going into the next expiry. This is different from the previous expiry sessions, when FIIs were seen taking long positions…While there is nothing alarming, it remains to be seen whether the positive momentum we have been seeing in the market will continue or not,” said Hemant Nahata, senior research analyst, IIFL.
Analysts said foreign investors preferred booking profits during this period, as December-end was a time for account-closing and holidays.
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The Nifty rollovers stood at 72 per cent, in line with the previous expiry sessions, with open interest positions almost intact at 19 million shares.
Nervousness was also seen in open interest positions in the banking sector, which were much lower, particularly for public sector undertakings (PSUs). “Stock-specific action was seen through the entire month. In the banking space, private and large-cap PSU banks gained, while smaller PSU banks remained under pressure,” said Sahaj Agrawal, deputy vice-president (derivatives research), Kotak Securities.
Analysts said open interest in PSU banks continued to be lower than 60 per cent, falling to 50 per cent in some cases. “The market is not able to make up its mind about PSU bank stocks. A high rollover percentage in PSU banks is missing despite the fact that some of these stocks have hit 52-week highs,” said Nahata.
Open interest in private sector banks had been dropping steadily, derivatives experts said. The sharp run-up in stocks such as YES Bank, Axis Bank and IndusInd Bank was prompting traders to reduce long positions, resulting in lower rollovers, analysts said.
On the stock futures front, analyst said going into the December series, the open interest was strong, with a hint of uncertainty, as only select stocks within a particular sector saw sharp rollovers.
For the Nifty, the ‘call’ concentration was highest at 8,500-levels, while the ‘put’ concentration was the highest at 8,000. Analysts said this could indicate higher volatility in the Nifty during December.