Indices hover near day's low; India VIX rises 3%

Key barometers traded sideways near the day's low in early afternoon trade. At 12:24 IST, the S&P BSE Sensex, declined 364.80 points or 0.91% at 39,524.16. The Nifty 50 index tumbled 116.35 points or 1% at 11,562.15.

Trading was volatile due to monthly expiry of the February series of derivatives contracts. The Nifty continued hovering below its 200-day simple moving average placed at 11,685.62. Investors are concerned the global economy could slow down as China struggles to contain the coronavirus outbreak.

The broader market witnessed steep selling. The S&P BSE Mid-Cap index was down 1.15% while the S&P BSE Small-Cap index was down 1.44%.

The market breadth was weak. On the BSE, 555 shares rose and 1583 shares fell. A total of 124 shares were unchanged. In Nifty 50 index, 7 stocks advanced while 43 stocks declined.

Derivatives:

The NSE's India VIX, a gauge of market's expectation of volatility over the near term, jumped 3.79% to 18.9525. The Nifty February 2020 futures were trading at 11,553.05, a discount of 6.8 points compared with the spot at 11,559.85.

On the options front, the Nifty option chain for 27 February 2020 expiry showed maximum call open interest (OI) of 74.75 lakh contracts at the 11,700 strike price. Massive call writing was witnessed at 11,700 strike price, which added 55.34 lakh contracts. Significant call unwinding was seen at 12,000 strike price which shed 6.22 lakh contracts.

Maximum put OI of 62.64 lakh contracts was seen at 11,500 strike price. Massive put writing was observed at 11,500 strike price which added 38.73 lakh contracts. Put unwinding was observed at 11,700 strike price which shed 7.9 lakh contracts.

The F&O contracts for February expire today, 27 February 2020.

Stocks in Spotlight:

Zuari Agro Chemicals rose 1.83% to Rs 83.65 after the company said its NPK-A plant in Goa has resumed production from 27 February 2020. The chemical maker had informed on 23 January 2020 that the NPK-A plant at Zuarinagar, Goa had been shut down due to non-availability of raw material.

TVS Motor Company on Thursday said it has strengthened its operations in Central America by forming a partnership with Motomundo SA, one of the largest business groups in Honduras. As a part of this collaboration, Motomundo SA will facilitate the sales and service of TVS products across all Motomundo stores in the country in a phase-wise manner. Motomundo SA stores will start with an exclusive outlet for TVS Motor Company and within a year, it will expand it to 3 stores in Honduras. Shares of TVS Motor were down 1.78% at Rs 427.75.

Larsen & Toubro (L&T) was down 0.82%. L&T said its construction arm has secured orders from prestigious clients for its varied businesses in India and abroad. As per the L&T's classification, the valuation of the 'significant' order stands between Rs 1000-2500 crore as per the classification.

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