Bears call the shots

F&O OUTLOOK

The bears were in complete command on Wednesday pulling down benchmark indices by around 2.50 per cent from the day's highs.

The BSE Sensex declined by 2.4 per cent from the day's high of 18129 to close at 17759, while the Nifty tumbled by 2.76 per cent from the day's high of 5314.

The sharp decline in benchmark indices with substantial rise in open interest, partly on account of rollovers, indicates fresh short positions.

While open interest increased by 8.27 million, the Nifty February futures witnessed fresh shorts as they closed at a 52-point discount to the Nifty spot prices.

Short rollovers were also seen in key index stocks such as Reliance Industries, ONGC, Reliance Communications, Reliance Energy, Hindustan Unilever, NTPC and Suzlon Energy.

The February futures contracts of the above mentioned stocks have declined by over five per cent each, with 15 to 70 per cent increase in open interest.

Long rollovers were seen in counters like Sun Pharmaceuticals, Zee Telefilms, BHEL, Punjab National Bank and SAIL.

While the rollovers continue to be poor in absolute terms, they seem comfortable in percentage terms. Of the total open interest (OI) of Rs 23,423 crore in Nifty futures, Rs 14,893 crore, or 63.58 per cent, has been rolled over in the February futures. Of the total stock futures of Rs 44,035 crore, OI of Rs 23,745 crore, or 53.9 per cent, has been rolled over.

The rollover have been substantially low compared with the rollover of Rs 17,298 crore in Nifty January futures and Rs 51,117 crore in January stocks futures on the penultimate day of expiry of the December futures.

The Nifty PCR-OI remained unchanged at 0.90. In the February series, the 4700, 5000 and 5200 puts were active.