Uptrend looks intact

F&O OUTLOOK

There has been a strong OI build-up in Nifty 4200 Put options for a second week running, indicating a strong support near the 4200 levels. Moreover, the rollovers to the June series have been smooth and the open interest implied volatility stands at comfortable levels.

Institutional buying, firm global markets and short covering on expiry of the May derivatives contracts, saw both the Nifty and the Sensex maintaining their dream run.

The Nifty 4200 Put options added 6 lakh shares in OI during the week and now stand at 53.4 lakh shares, representing 38.7% of the total put options OI. The OI of Nifty 4300 Put stands at 16.9 lakh shares, with the addition of 9.7 lakh shares. 

F&O SNAPSHOT
	Turnover (rs crore)*		Open int ('000)**
	May 03,07	Jun 01,07	May 03,07	Jun 01,07
Nifty	300540.72	306260.84	54706.00	53043.00
BANKNIFTY	1927.13	2415.95	142.00	183.00
CNXIT	139.69	706.89	27.00	153.00
Stock	313679.04	440810.27	1046120.00	1287624.00
NSE Total	616286.58	750430.91	1100996.00	1341227.00
*Monthly aggregates notional Value ,**In shares

The Nifty 4300 Call options stood at 27.5 lakh shares during the week. There has been call writing at the 4300 level, which suggests a possible resistance at this level.

Zeal Mehta, derivatives analyst with Emkay Securities continues to remain bullish on the Nifty, as the rollover has been impressive across the board, and especially in the banking and metal stocks.

According to him, the cost of carry has turned positive for Amtek Auto, Educomp, Hindalco, ICICI Bank, Jindal Stainless and Satyam, and negative for HPCL.