Indian Market may hit higher circuit again today

Courtesy: www.moneycontrol.com

The SGX Nifty was up 5.33% or 533 points to 4,603 and Asian markets were trading strong following positive US cues. So, the Nifty may hit circuit if it crosses 4,623.15 level. Circuit limit for the Nifty is at 300 points and Sensex at 950 points.

What happens today?

A lot of hedged positions were outstanding in the market today and hedges were taken via selling Nifty Calls. Nifty Call writes need to cover positions aggressively.

A 4000 Call has Open Interest of 41 lakh shares and 3800 Call has Open Interest of 45 lakh shares. A 4000 Call has premium of Rs 370 and 3800 Call has premium of Rs 460.

Option trouble

HDFC Bank's 1140 Call has Open Interest of 10 lakh shares. SBI's 1380 Call has Open Interest of 6 lakh shares.

ICICI Bank's 580 Call has Open Interest of 13 lakh shares. RIL's (Reliance Industries) 1980 and 1950 Calls have Open Interest of over 3 lakh shares each.

Golden Monday

The markets gave big thumbs up to the Congress' sweeping victory in general elections and hit 2 upper circuits of total 17.5% for the first time in stock market history.

It hit 15% circuit in the initial 30 seconds of opening trade and trade halted for the first time ever due to upper circuit. Total volumes traded on the NSE and BSE at Rs 3,100 crore, which comprised F&O turnover of Rs 2,833 crore. Only 207 stocks traded on the NSE and 842 stocks traded on the BSE.

10-year bond was up Rs 1.25 and yield was down 17 bps to 6.25%. Rupee ended at 4-month high; gained 2% at 48.24/$ as against 49.40/$ on Friday