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Jolting Nifty cracks ~5% eoe, IndiaVix at yearly high

Nifty crumbled ~5% in the February series, down for the straight fifth expiry. Throughout the series, Nifty trended lower as recoveries remained short lived. Brent crude topped $100/bbl, while Gold is roaring above $1900/oz. Highlights for the Feb series were a) BankNifty underperformed, losing 7% on expiry to expiry basis b) India volatility index shot up 52% on eoe to settle near levels of 32, it is highest reading since June 2020 c) Nifty Realty and Media sector underperformed the most, down 11/13%. eoe d) Midcap and small cap stocks fell like a pack of card in the recent past.

Rollovers for Nifty/Bank-Nifty stood at 77% (1.12cr shrs)/76% (22lakh shrs) vs 75% (1.09cr shrs)/84% (19.8lakh shrs) previous month. Market wide rolls stood at 89%vs 91% previous month.

FII’s long short index futures ratio seen at 1.20x vs 3 months avg. of 1.6x levels. On options front, Max. call/put OI on Nifty for March monthly series at 18000 call strike and 16500k put strike. Given the fact, CBOE index reclaiming levels of 30, Gold inching higher and depreciation of rupee against the dollar; undertone for the market remains negative. Higher VIX is likely to keep near term outlook uncertain with overhead resistance near 16800.

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