The market breadth was good but the gains were unevenly distributed. Most of the index contributions came from bank and pharma stocks with some bullishness in the energy sector as well.

The picture in the bank sector now looks mixed. PNB, SBI, Kotak and Corporation Bank appear to have topped out – one could go so far as to suggest that PNB and Corporation are worth shorts, while SBI is likely to range-trade. But Bank of Baroda, Bank of India, Syndicate Bank and maybe HDFC Bank could continue to run up. Of these, BoI and Syndicate look like the best futures positions.

Among pharma stocks, Ranbaxy, Dr Reddy’s, Cipla and Sun Pharma look interesting. Dr Reddy’s is swinging through a wide range and either a long or short futures position could work at the present moment.

Unfortunately there's zero liquidity in the options segment. Cipla and Sun Pharma look quite bullish while Ranbaxy could see a correction or range-trade for a while before moving up again.

Long futures in Cipla and Sun could pay off. The third interesting sector was PSU energy and refining stocks. Here Gail, HPCL and ONGC look to be worth long futures positions.

There was scattered across most other sectors – Reliance Industries, VSNL, GE Shipping, Indian Hotels and Mahindra were among the more prominent gainers. Each of these seems promising – perhaps VSNL and GE shipping are the most promising in terms of having the clearest technical patterns to support .long futures positions.

Reliance is one of the few F&O counters, which actually has decent liquidity in the options segment. ONGC is another counter with good options liquidity.

A bull spread in RIL with long 1110c (46.5) versus short 1140c (35) costs about 12 and pays a maximum of 18. With spot poised at around 1100, this is a decent position. In ONGC, spot is at 1365. A long 1380c (33) versus short 1410 (24) costs about 9 and offers a maximum of 21. There's a resistance at 1395 but even a rise to that level would put the bull spread in the black.