The Hindu Business Line : Despondent trading

THE cash market was in doldrums for most of the week with the indices ending in red. The Nifty ended lower by 1.72 per cent at 999.6 levels as compared with last week's 1017.1 levels. The trend in the F&O market was also in line with the cash market. The total traded volumes in this segment declined marginally to around 96,084 contracts down by 3.8 per cent over the previous week.

Nifty Futures: The near-month contract was the most actively traded contract. With the spot Nifty falling, the March contract closed this week down by around 2 per cent over the previous week. Short positions would have ended profitable this week. The contract closed at 0.34 per cent premium to the spot. The traded volumes declined by 4.22 per cent whereas the open interest increased by 5.6 per cent indicating that not many new positions were taken this week.

The Nifty May contract saw increased trading activity with the traded volumes increasing by 31 per cent and the open interest by 12 per cent. The far-month future had very little trading activity.

Nifty Options: The traded volumes declined by 23.7 per cent. The put-call ratio for the Nifty march contracts remained the same at 0.45 indicating the stagnation in the contracts.

The most active calls were the 1000 March call and 1010 March call. The out-of-the-money (OTM) 1010 March call declined 55 per cent to Rs 9.05 with an open interest 2.1 lakh contracts. The most active put was the 1000 March put and 990 March put. Volumes and open interest in the 1050 March put (ITM) decreased to close this week at Rs 48.50. The put-call ratio for the April Nifty contracts has declined from last week's 2.68 to 0.68 due to huge interest in April calls. This indicates investor's bullish sentiment in the Nifty in the medium term. Among the April contracts 1040 contracts (both call and put) were the most active. The 1030 April call and 1020 April (OTM) call also were traded. With the Nifty declining below 1,000 levels, the 990 and 980 contracts were introduced. The in-the-money (ITM) 990 March call had very little trading.

Stock Futures: The traded volumes increased marginally by 2 per cent. Intriguingly the Satyam near-month future was the most actively traded contract as compared with the normal trend of the Nifty near-month future being the actively traded. Apart from the Satyam contracts, Infosys, Digital, Mastek were actively traded.

With the Spot Satyam declining the future contract also declined by 5 per cent to close at Rs195.35 as compared with last week's Rs 205.25. With the Ranbaxy spot declining this week, the March future contract saw fresh trading with open interest increasing by 5.24 per cent.

Stock Options: The traded volumes declined by 14 per cent as compared with last week volumes. Satyam, Reliance, Digital, Mastek were the most actively traded.

The Hero Honda 220 March call (ITM) attracted trading interest following the trend in the spot market. BPCL 220 March call and 230 March call (both ITM) closed this week with huge open interest. Among the put contracts the Digital 600 March put (OTM) and BHEL (ATM) 200 March put were actively traded. The 150 March put (ITM) closed higher by 28 per cent at Rs 9.10 as compared with last week's close of Rs 6.55. Among the April contracts the ACC (150 call, 135 put) and BPCL (600 put) witnessed some trading interest.

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