The rollovers for the near-month October to November derivative contracts on Thursday were lower in terms of absolute open interest. Rollovers in Nifty contracts was about 68%?about 2% lower than the previous month.
The turnover in Nifty derivatives on Thursday touched Rs 2.52 lakh crore, the highest value ever. This was largely driven by the heightened activity in the options market, said analysts.
Also, the Nifty corrected by about a percentage point on the back of unwinding of arbitrage positions and heavy selling in the last half an hour of trading.
There has been an expansion in the rollover cost in the Nifty by around 90 bps and stock futures by 75-80 bps. ?As the funding costs have gone up, arbitragers need higher profits to roll over their short positions,? said Yogesh Radke, Head of Quantitative Research at Edelweiss Securities. According to Siddarth Bhamre, head?derivatives, Angel Broking, the premium between the October and November series rose to 80-90 basis points in the last half an hour of trading, which indicates that most of the long positions had rolled over.
The fertilizer sector saw a high rollover on news that the government is actively looking to decontrol the sector. Telecom saw high rollovers but most of the positions were on the shorter side, while banking was mixed with high rollovers in mid-caps and less than average rollovers in large-caps. Auto saw less rollover in terms of absolute open interest.
Orchid chemicals, India Infoline, United Phosphorus, Tata Chemicals and mid-cap IT companies such as Educomp and Rolta saw healthy rollovers. Auto firms Bajaj Auto and Tata Motors and banking heavyweights ICICI Bank and HDFC Bank saw below average rollovers.
Experts believe that the 5980 levels is a good support for the market and 6150-6200 should be a good level to book profits. ?Liquidity in the system will increase as the refund from the Coal India IPO comes in, which should keep the market momentum going,? said Radke.