F&O expiry may trigger volatility

Trading could be volatile as traders roll over positions in the F&O segment from the near month January 2020 series to February 2020. The January 2020 F&O contracts expire today, 30 January 2020.

Trading of Nifty 50 index futures on the Singapore stock exchange indicates that the Nifty could fall 7 points at the opening bell.

Overseas, most Asian stocks were trading lower on Thursday while gold and bonds were in demand as worries about the spread of a new virus from China sent investors heading for safety.

In US, stocks ended little changed on Wednesday, with better-than-expected results from blue-chip names, including Apple, offset by lingering concerns related to China's coronavirus outbreak.

The Federal Reserve held its benchmark fed funds interest rate steady in a range between 1.5% and 1.75% on Wednesday, saying the economy remained on a moderate growth path. But Fed Chairman Jerome Powell acknowledged that the coronavirus epidemic in China introduces uncertainty into the outlook and also called asset valuations somewhat elevated.

Back home, key barometers ended with modest gains after a fairly range bound session on Wednesday. Recovery in global stock markets boosted sentiment. However, gains were capped ahead of January F&O expiry on Thursday and the Union Budget on Saturday. The barometer BSE S&P Sensex rose 231.80 points or 0.57% to 41,198.66. The Nifty 50 index added 73.70 points or 0.61% to 12,129.50.

The trading activity on that day showed that the foreign portfolio investors (FPIs) sold shares worth a net Rs 1014.27 crore yesterday, 29 January 2020, as per provisional data released by the stock exchanges. Domestic institutional investors (DIIs) bought shares worth a net Rs 1520.90 crore, yesterday, 29 January 2020, as per provisional data.

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