Street signs: Shorts build up in SBI, insurers use fall to nibble on stocks

Shorts build up in

SBI 

Traders have built up short positions in State Bank of India (SBI) ahead of its September quarter result announcement on Monday. An analysis of derivatives trading data show high volumes and open interest build-up in ‘put’ options with strikes of Rs 260, Rs 270 and Rs 280.

After touching a high of Rs 293, shares of SBI ended flat at Rs 285 on Friday even as the benchmark indices rallied around two per cent. “After Punjab National Bank posted disappointing earnings on Friday, some investors went against the market momentum and built short positions in SBI. After the recent gains, a correction could be due if results fail to meet expectations,” said an analyst. - Samie Modak

MF distribution scene heating up 

The buzz created by Paytm Money, the mutual fund platform promoted by the Alibaba-backed wallet turned payments bank Paytm, has attracted rival attention. Industry players say, at least one major well-funded digital start-up has also begun work on a platform for mutual funds. Hiring for the platform has already begun, according to market buzz. As with everything else in the start-up world, this rivalry may also be fierce. Mutual fund investors probably won't complain as these will bring down the cost of investing. - Sachin P Mampatta

Insurers use fall to nibble on stocks

Insurance companies seem to have used the recent correction to buy shares. While mutual funds (MFs) have been on a buying spree in the past two years, it is only recently that insurers have started nibbling in stocks. Between May and October, domestic institutional investors made net investments in stocks of Rs 755 billion even as MFs purchased stocks worth Rs 667 billion, indicating marginal buying interest from insurers. “Insurers have not faced any major redemption pressure of late and it is possible that some of the players used the correction as a buying opportunity,” said an institutional analyst.  - Ashley Coutinho