The expiry of the September series was filled with activity even as the rollover of the Nifty index futures were at par with that of the last series. Exclusion of 50 stocks from the derivatives segment and changes in the Nifty index constituents also provided some buzz to derivatives segment on National Stock Exchange (NSE).
At 63.8%, the September series rollover were in line with that observed for August, but were lower than the three-month average rollover of 66%. Traders cite the Nifty rollovers and the market-wide rollovers (84%) to be healthy as they expect the Nifty to stay strong for a likely upmove towards 5,800.
?At the beginning of the October series, 5,700 and 5,800 calls have witnessed healthy open interest, indicating the range to be the next upside resistance for the Nifty,? said Angel Broking’s equity derivatives head Siddarth Bhamre. However, Bhamre believes the maximum call buildup near these strikes does not necessarily indicate that the Nifty may not rise above these levels.
?Even after registering gains in the September series, the Nifty may see a robust move in the October series if 5,800 is taken, given that many traders were not able to participate in the latest jump,? added another trader.
The Bank Nifty witnessed a rollover of 53.5%, with stocks like HDFC Bank, ICICI Bank, Canara Bank, and Bank of India seeing 55-65% of the positions being rolled over. In the last two derivative series rollovers for this sectoral index futures were as high as 71% and 67%.
?Rollovers in the Bank Nifty index futures were less given that the space still had significant short positions which were not rolled over into the October series. With the market rebound, banking stocks have gained substantially, somewhat lightening the bearish sentiment for the sector,? added Bhamre.
Following the exclusion of the 50 stocks from the derivatives segment as announced in July, many of them experienced sharp price moves in the cash market as the traders completely neutralised their arbitrage positions between cash and futures market. MTNL and Ruchi Soya were among the few stocks that observed heightened volatility before settling with a fall and gain of 16%, respectively.
The 50 stocks were announced to be excluded from the F&O segment post-September series, after Sebi revised the eligibility criteria for stocks in the derivatives segment. The list includes Bombay Dyeing, Essar Oil, Jet Airways, India Infoline, Shobha Developers, Videocon Industries and TVS Motor.
In the the blue-chip space, both SAIL and Sterlite Industries dipped by more than 3% while Ultratech gained nearly 3.5% after the latter replaced the formers along with Lupin in the Nifty.
Metal stocks observed healthy rollovers of the order of 80-85% lead by Tata Steel, Sesa Goa, Sterlite and Hindalco. Other Index movers of the September series, like L&T, M&M, Reliance Industries and Tata Power observed rollovers that ranged between 70% and 80%.