F&O Morning Update for 5 January 2023

Asian Markets Update @ 7:00 am

The SGX Nifty rose 0.3% or 55 points from its previous close, suggesting a positive start for the Nifty50 today. Major Asian markets are also trading in the green. Nikkei 225 in Japan rose 0.8%, while Hong Kong's Hang Seng index gained 1.9%.

Global Markets Update

US markets closed Wednesday’s session with gains after the release of the US Fed’s December meeting minutes. The report showed that the US Fed intends to hold higher rates until sufficient data proves that the inflation has cooled. The minutes also highlighted that no Fed officials expect rate cuts in 2023.

All three major indexes came off the session’s high after the release of Fed minutes. The Dow Jones gained 0.4% to close at 33,269. The S&P 500 advanced 0.7% and ended the day at 3,852. The tech-focused Nasdaq Composite climbed 0.6% and closed at 10,458.

Index Action

Nifty50
January Futures: 18,102 📉▼214 (-1.7%)
OI contracts: 2,23,308 (+1.7%)

The Nifty50 index erased gains of the last four days and closed the volatile session lower near the day’s low. The index remained under the grip of bears throughout the session and took support at 18,000-mark. 

All the major sectoral indices struggled and closed in red, with Metal (-2.1%) and Realty (-2.0%) shedding the most.

Nifty50’s options contracts expiring on 5 January have sizable positions at 18,200 and 18,300 call options and 18,000 and 17,900 put options. 

As per options data and OI analysis, the broad range for the Nifty50 is between 17,400 and 18,600 levels. On the other hand, 17,800 and 18,200 are the critical levels to watch for the current week.

Bank Nifty
January Futures: 43,150 📉▼459 (-1.0%)
OI contracts: 93,792 (+2.2%)

After a flat start, the Bank Nifty index faced hurdle around the 43,500-mark and came under selling pressure. The index fell more than 600 points from the day's high and closed Wednesday's session 1% lower near the day's low.

All the twelve stocks of the banking index closed in red, with Punjab National Bank (-2.6%) and Bank of Baroda (-2.5%) being the top laggards.

Bank Nifty’s options contracts expiring on 5 January have sizable positions at 43,500 and 43,000 call options and 43,000 and 42,500 put options.

As per options data and OI analysis, the broad range for the Bank Nifty is between 42,000 and 44,000 levels. On the other hand, 42,700 and 43,500 are the critical levels to watch for the current week.

FII and DII Data**💰

The Foreign Institutional Investors (FIIs) sold shares worth ₹2,620 crore, while Domestic  Institutional Investors (DIIs) purchased shares worth ₹773 crore in the cash market. In the derivatives market, FIIs sold index futures worth ₹2,604 crore and bought index options worth ₹779 crore. Further, they sold stock futures worth ₹2,101 crore and sold stock options worth ₹11 crore.

India VIX 

The India VIX, which measures the implied volatility of Nifty50 options, rose 5.6% to 15.20.

Stock Action📊

Long build-up was seen in GNFC, Astral, Chambal Fertilisers, Havells India and Shree Cement.

Short build-up was seen in Gujarat Gas, Indus Towers, Deepak Nitrite, Navin Fluorine and Infosys.

*In Futures and Options or F&O, long build-up means an increase in Open Interest (OI) along with an increase in price, and short build-up means an increase in Open Interest (OI) along with a decrease in price.

**Source: nseindia.com. Cash market figures are provisional.