Fall in markets amplify, heavy open interest addition seen in 15,800 Call option!

US Dow Jones Future down by more than 1 per cent and Hang Seng Index down by nearly 3 per cent

Market Update at 01:15 PM: Indian markets extended their losses on Thursday. Nifty and Sensex were seen trading down by 0.72 and 0.68 per cent, respectively.  

A divergent trend was seen in the broader markets as Nifty Midcap 100 plunged 0.08 per cent whereas Nifty Smallcap 100 gained 0.12 per cent.   

Among the sectoral indices, all indices were trading in red with Nifty Metal and Nifty Pharma being the worst hit as they were down by 1.62 per cent & 0.93 per cent, respectively.   

On the options’ front, 15,800 Call has seen massive addition of open interest of over 75 lakh shares while 15,800 Put witnessed the unwinding of nearly 18 lakh shares. The 15,700 Call option also saw the addition of 27 lakh shares. Meanwhile, Max Pain stood at 15,800 level.

Market Update at 11:50 AM:The key benchmark indices have slipped lower and were seen trading with modest losses of a quarter of a per cent.  

BSE Sensex slipped below the 53,000 mark while Nifty is seen hovering around the 15,830 mark. Despite negative bias witnessed in the frontline indices, there is a buying interest in the broader markets. The testimony of this is that Nifty Midcap 100 and Nifty Smallcap 100 were seen trading with gains of 0.37 per cent and 0.78 per cent, respectively. Interestingly, Nifty Smallcap has hit a fresh all-time high on Thursday.   

Among the sectoral indices, Nifty Realty, Nifty Media, and Nifty Energy were seen trading with gains of 0.9 per cent, 0.63 per cent and 0.12 per cent, respectively.  On the flip side, Nifty Metal and Nifty FMCG were down by more than half a per cent.   

One sector is gaining a lot of attention today and that is - packaged foods. Many of the stocks from this segment have seen huge moves including Tasty Bite Eatables, which surged over 13 per cent while Prataap Snacks climbed more than 6 per cent.   

Indian markets ended on a positive note on Wednesday with Sensex & Nifty advancing by 0.39 per cent and 0.37 per cent, respectively. The broader markets outperformed the frontline indices with Nifty Midcap 100 and Smallcap 100 gaining 0.66 per cent and 0.62 per cent, respectively.   

Among the sectoral indices, Nifty Metal & Nifty Realty jumped 2.2 per cent and 1.96 per cent, respectively. On the other hand, Nifty Media and Nifty Energy ended with losses of 0.17 per cent and 0.16 per cent, respectively.   

Nifty formed a bullish candle with a lower shadow on the daily chart, which indicates buying interest was visible around the 20-DMA. Nifty, for the fifth time, tested the zone of 15,895-15,915 on Wednesday. The index is repeatedly testing the resistance zone. Going ahead, a close above the afore-mentioned zone would be positive for the index.   

On the downside, important support for the index is placed around 20-DMA, and as long as Nifty holds above the 20-DMA, buy-on-dips strategy should be adopted by the traders.   

On Thursday, markets would first react to the Cabinet reshuffle and along with this, it would also take cues from Q1FY22 earnings as in the near-term, earnings are likely to provide the much-needed trigger to markets, which is seen oscillating in a band. IT bellwether-TCS would announce its earnings on July 08, 2021.   

Furthermore, it would be interesting to check how market participants would react to the news of Coronavirus variant-Lambda as its strain got detected in over 30 countries.