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Traders rollover fewer bets into July series

The expiry session of the June series derivatives contracts on Thursday saw about 63% of Nifty futures getting carried forward, as against a 71% three-month average

Sneha Padiyath  |  Mumbai 

Traders rolled over fewer bets into the July series as nervousness in the market continued, on account of the Greece payment crisis in Europe and overhang of the monsoon.

The expiry session of the June series derivatives contracts on Thursday saw about 63 per cent of Nifty futures getting carried forward, as against a 71 per cent three-month average.

Analysts said traders had adopted a more cautious approach in carrying forward positions, as Greece's payment crisis had still found no resolution at the expiry of June series, even as domestic worries on the monsoon seem to be slowly subsiding.

“Traders were much more positive at the end of the June series than at the beginning. But, they are still concerned about global and domestic issues,” said Yogesh Radke, head of quantitative research, Edelweiss Securities.

Analysts believe the positive momentum could continue in the initial part of the series as a clearer picture about the monsoons and the Greece payment crisis emerges.

“We saw a trend reversal towards the end of the series, with foreign institutional investors (FIIs) turning net buyers of index futures. Going forward, any global event perceived to be negative could turn them into net sellers again,” he said.

According to analysts, FIIs were net buyers of index futures at Rs 1,400 crore on Thursday, when the closed up about 0.6 per cent.

The open interest (OI, positions not settled at the end of the trading session) in Nifty futures, at Rs 12,300 crore was higher than that at the end of the May series at Rs 11,100 crore. The market-wide OI positions remained unchanged at Rs 68,500 crore against the Rs 68,600 crore in the previous expiry.

The put-call ratio was 1.41, analysts said. “The put-positions created were higher, hinting at quite a lot of hedging activity by traders. There is clear nervousness in the market and the Nifty could find resistance at 8,500-8,550. We expect to see some profit booking at these levels,” said Sahaj Agrawal, deputy vice-president, derivatives research, Kotak Securities.

Bank Nifty futures saw a rollover of 56 per cent, much below the 68 per cent three-month average. This has been led by lower rollover in private banks, which came under the scanner this month on worries over a weak monsoon and doubts about another rate cut by the Reserve Bank of India (RBI). Sectors which saw strong rollovers were automobiles and public sector banks, as an improving outlook on monsoons has led to hopes of another rate cut by RBI.

“Total OI was flat for the month but autos and tech OI were up more than 10 per cent, while private banks' OI was down eight per cent. Rolls have been strongest in autos, energy and PSU banks, and weakest in telecom and consumer names,” said S Hariharan, head, sales trading (institutional equities), Emkay Global Financial Services.

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First Published: Thu, June 25 2015. 22:49 IST