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Activity picks up in December contracts

K.S. Badri Narayanan

ACTIVITY picked up at futures & options segment on the NSE on Friday, ahead of the settlement week, (the near month November contracts are expiring on November 27); the F&O segment witnessed a turnover of Rs 10,957 crore as against Thursday's Rs 9,800 crore. Turnover surpassed the Rs 10,000-crore mark after a gap of 10 trading sessions (on November 6, the turnover was Rs 10,243 crore).

Cumulative FIIs' positions as percentage of total gross market position, as on Thursday was 18.61 per cent. They had bought about Rs 262 crore and sold Rs 221 crore worth contracts on Thursday.

Index futures: The Nifty spot movement was volatile; after touching an intra-day low of 1509, the Nifty recovered smartly towards the close to end at 1540.70, up 18.40 points.

The near-month Nifty November futures closed the day at 1546.80 (a premium of over six points to the spot close) as against the previous day's close of 1526.35; open interest positions, however, slipped by over seven per cent to 26,882 contracts. The unmatched order book of the NSE suggests bullish undertone as bid side calls were higher to that of sell side by close to 2.5 times.

The December futures also ended the day in premium to the spot close at 1548.65 as against the previous day's close of 1529.15; Open interest position swelled by over 87 per cent to 5,832 contracts, signalling that most players are rolling over their positions.

Stock futures: All the 53 listed securities got traded; the total number of contracts traded was 1,45,292 with a traded value of Rs 6470.25 crore. There was rollover of positions to the December series from most sectors. Satyam Computer was the most active followed by Reliance Industries, Tata Steel, Tata Motors and Maruti Udyog.

The Tata Motors November contract closed the day higher at Rs 386.95 (Rs 375.80); the spot closed at Rs 386.60. Open interest positions slipped by over six per cent to 2,464 contracts. But they were rolled over to December contracts; open interest position for December contract jumped to 544 contracts (a jump of over 100 per cent), which closed the day at Rs 389.95 (Rs 378.70).

Similarly, banking sector counters Bank of Baroda and SBI also witnessed rollover of positions to the December series.

Index options: With the market witnessing wild swinging, the November 1550, 1520 and the 1530 strikes turned active among call options. Among the puts, the most active contracts were the November 1520, 1540 and the 1500 strikes. The in-the-money November 1520 calls closed the day higher at Rs 33.25 (Rs 23.25). Open interest surged close to 50 per cent 557 contracts. On the other hand, the out-of-the money 1520 puts slumped to Rs 8 (Rs 18.85) though open interest improved 40 per cent to 912 contracts.

Since the market is very volatile, investors are advised to hedge their positions by buying Nifty put options.

Equity options: Among individual stock options, contracts on Satyam Computer, Tata Steel, Tata Motors and Reliance were actively traded.

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