The July futures contracts expired on a dull note. The rollovers in Nifty and key stock futures were remarkably lower than last month, indicating indecisiveness among the market participants.
The FIIs played safe by covering their short positions in index futures on Wednesday and going long on banks, capital goods and technology sectors.
The rollovers in Nifty August futures have declined by 30.3 per cent to 27.1 million shares from 38.84 million shares that were carried forward into the July series. The August rollovers have, however, taken place at a premium. Moderate rollovers have historically led to bull rallies, at least for the short term.
The markets witnessed sell-off in July as substantial short positions were rolled over into the July series. The Nifty futures were rolled over at a discount of 63 points and only 11 of the index constituents were rolled over at a premium. No wonder, both the Nifty and Sensex hit 15-month lows in the first week of July contracts.
This time, the Nifty August futures and as many as 36 Nifty stock futures have been rolled over at a premium. This is a positive development. However, the SGX CNX Nifty August futures traded on the OTC counter in Singapore Exchange, declined to 4303 after opening at 4380 and this may have a negative impact on tomorrow’s trading.
Among the stock futures, BHEL, Larsen & Toubro, Infosys Technologies, HDFC, Reliance Industries, Reliance Energy, ONGC, Grasim, Bharti Airtel and Tata Steel witnessed short-covering and positive rollovers. However, the futures of National Aluminium, Wipro, GAIL, Sterlite Industries, DLF, Tata Power, Maruti Udyog, Tata Motors, State Bank of India and Hero Honda were rolled over at a discount.