Index futures turnover declines

DERIVATIVES REPORT

Volumes in the derivatives segment went up slightly with the turnover at Rs 8,893 crore and a total of 2.9 lakh contracts being traded.

Turnover in index futures was at Rs 2,481 crore while the turnover in stock futures was at Rs 5,621 crore. Dealers said that there was a lot of action in stock futures as stock-specific activity is still leading the stakes in the cash segment.

"Nobody seems to be betting on the index," said a dealer rationalising the poor volumes in index futures.

In the futures segment, the most active contracts were those of Tata Steel, Tata Motors, Reliance Industries, Satyam and ACC among others. In the options segment, the most active contracts were Tata Steel calls at strikes of 400, 410 and 390, ACC call at a strike of Rs 250 and Satyam call at Rs 340.

Meanwhile, the Nifty futures saw a reduction of around three lakh shares in open interest while at the end of the day Nifty August series ended at a discount of around five points to the spot Nifty.

The Nifty put-call ratio also went up marginally with put options exceeding call options. Dealers said that it was more symptomatic of the uncertainty in the market rather than any actual bearish sentiment.

Figures at the end of the day showed that the cost of carry in stock futures had increased with the premium ranging around the 0.5 per cent mark.

Many stocks saw an increase in their open interest positions. Canara Bank added nine lakh shares, HPCL added five lakh shares, MTNL added around seven lakh shares, while Bank of Baroda saw its open interest positions going up by 24 per cent.

Among the futures which saw a reduction in open interest position were IOC (by 12 per cent), Gujarat Ambuja (eight per cent), Tata Power (seven per cent) and Reliance Industries (six per cent).

On Monday, foreign institutional investors had been net buyers to the tune of Rs 117 crore mainly in index futures while their open interest position has gone up by around five lakh shares.

Cumulative FII positions as percentage of total gross market position in the derivative segment as on August 2, 2004 was 20.52 per cent.