IGI Logo

The Day That Was:

Nifty Futures: 25,898.9 (0.0%), Bank Nifty Futures: 58,404.4 (0.4%).

NIFTY Futures saw a minor correction, falling 6.6 points with a corresponding 0.5% decrease in Open Interest (OI), which settled at 180.52 lakh shares, indicating Long Unwinding. In contrast, BANK NIFTY Futures outperformed, rising 219.8 points on a 3.7% increase in OI to 19.45 lakh shares, signalling Long Build Up. This cautious recovery in the market snapped a two-day losing streak following a volatile trading session, primarily driven by stock-specific buying catalyzed by positive quarterly earnings and robust performance in the Realty and PSU Bank sectors. The broader market sentiment, however, remained cautious amid mixed Asian markets and global anticipation of key US economic data. This dynamic kept the market in a consolidation phase as investors awaited clearer directional triggers. NIFTY Futures' premium decreased from 183 points to 136 points, while BANK NIFTY's premium also shed points, decreasing from 408 to 303. Sectoral rotation was evident as Realty, PSU Bank, and Pharma shares advanced, while Consumer Durables, IT, and FMCG shares declined. Meanwhile, India VIX settled at 12.66, rising 4.2%, suggesting an uptick in short-term volatility and trader apprehension despite the overall market gain. Adding to the underlying weakness, the Rupee extended its descent for the third straight day, settling seven paise down at 88.77 against the US Dollar, near its all-time low, weighed down by a strong American currency and foreign fund outflows.

Global Movers:

US markets were mixed to higher on Monday, with the technology-heavy Nasdaq Composite and the S&P 500 advancing, primarily driven by surging Artificial Intelligence (AI) stocks and a major corporate acquisition. The S&P 500 gained 0.2% to close at approximately 6,851.97, while the Nasdaq Composite climbed 0.5% to roughly 23,834, fueled by a nearly 4% jump in Amazon shares following a major AI-related deal with OpenAI. Offsetting these gains, the Dow Jones Industrial Average fell 0.5% to close at approximately 47,336. In fixed income, the 10-Year Treasury Yield was slightly higher, rising 2 basis points to 4.10%. In the commodities space, Spot Gold was steady, trading around $4,008.34 per ounce, and Spot Silver climbed modestly to $48.75 per ounce. Meanwhile, Brent crude futures settled at $64.89 a barrel, holding steady as the market balanced an OPEC+ supply increase against plans to pause output hikes in the first quarter of the following year.

Stock Futures:

Shriram Finance Ltd. (SHRIRAMFIN) surged to a fresh 52-week high, propelled by stellar Q2 FY26 earnings that underscored a 11.4%-11.6% YoY jump in consolidated net profit, a robust 15.7% expansion in AUM, and a notable improvement in asset quality with Stage 3 ratio easing to 2.49%. The stock rallied 5.9% amid short covering, accompanied by a 3.6% contraction in futures open interest, shedding 2,330 contracts to settle at 62,424. In the options arena, call open interest rose by 3,692 contracts to 15,803, while put positions expanded by 6,763 contracts to 16,283, lifting the PCR to 1.03 from 0.79. The rising PCR and heavier put additions suggest option buyers are positioning for continued upside, while option writers may be hedging against further bullish momentum.

HFCL Ltd. (HFCL) rallied on the back of a sharp turnaround in profitability, reversing prior losses with a positive PAT and a fivefold QoQ surge in EBITDA, driven by momentum in BharatNet and rising global demand for OFC amid 5G and AI infrastructure expansion. The stock climbed 5.8% with short covering, as futures open interest declined 5.7%, shedding 1,127 contracts to 18,694. Futures traded at a premium of 0.88 points, up from 0.82. Option data revealed a contraction in call open interest by 1,178 contracts to 6,765 and a smaller decline in put positions by 223 contracts to 3,873. The narrowing of both sides, especially calls, indicates option buyers may be booking profits, while option writers are cautiously unwinding bullish bets amid elevated valuations.

Patanjali Foods Ltd. (PATANJALI) faced selling pressure despite reporting strong quarterly earnings, as the marginal movement in EBITDA Margin signaled that profit growth stemmed more from favorable input costs and tax benefits than operational efficiency. The stock declined 4.4% amid short addition, with futures open interest rising 7%, adding 2,584 contracts to reach 39,464. On the options front, call open interest surged by 8,333 contracts to 14,157, while puts rose by 3,203 contracts to 5,321, pushing the PCR slightly higher to 0.38 from 0.36. The sharp build-up in calls relative to puts suggests option writers are bracing for further downside, while buyers are positioning for limited upside amid rising implied volatility at 28.24%, up 6.77%.

Maruti Suzuki India Ltd. (MARUTI) witnessed a pullback following Q2 FY26 results that, despite an 8% YoY rise in net profit and 13% revenue growth, fell short of market expectations, with EBITDA Margin contracting to 10.5% from 11.9% YoY due to elevated operating costs and discounting pressures. The stock slipped 3.4% with short addition, as futures open interest rose 2.1%, adding 1,181 contracts to 57,982. In options, call open interest ballooned by 29,143 contracts to 65,725, while puts saw a modest increase of 1,173 contracts to 26,618, dragging the PCR down to 0.40 from 0.70. The aggressive call writing and subdued put additions reflect a bearish stance from option writers, while buyers appear cautious, anticipating limited upside amid valuation concerns.

Put-Call Ratio Snapshot:

The Nifty put-call ratio (PCR) rose to 0.78 from 0.64 points, while the Bank Nifty PCR rose from 0.91 to 0.98 points.

Implied Volatility:

Voltas and UPL are exhibiting elevated option pricing as evidenced by their high Implied Volatility Ranks (IVRs) of 64% and 62%, respectively. These IVR readings signify that current option premiums are situated toward the upper bound of their historical percentile range, suggesting heightened market anticipation of future price movements. This inflated IV environment leads to a disproportionately expensive cost of optionality. Consequently, directional plays such as purchasing Long Calls or Long Puts outright become less capital-efficient and are rendered structurally unattractive under the prevailing premium structure.

Conversely, Bajaj Auto and HDFC Life currently register the lowest IVRs in the F&O universe. Their Expected Volatilities (EVs) have contracted significantly, compressing to 19% apiece. This volatility compression has resulted in a material reduction in option premium outlays, presenting a more opportune scenario for establishing directional trades. The subdued premium structure on these counters translates to tighter breakeven points and an improved risk-reward profile, thereby enhancing the leverage efficiency for deploying Long Call and Long Put positions.

Options volume and Open Interest highlights:

Titagarh and Mazdock Shipbuilders are currently experiencing elevated speculative interest in the F&O segment, as evidenced by sharply skewed Call-to-Put Volume Ratios of 6:1 and 5:1, respectively. This pronounced call-side dominance has triggered a notable surge in Implied Volatility (IV), thereby inflating premiums and increasing the cost of initiating fresh directional positions. Historically, such disproportionate call activity tends to act as a contrarian signal, suggesting that the prevailing bullish trend may be nearing exhaustion. Conversely, BHEL and Hindalco Industries are reflecting a more risk-averse tone, marked by heightened Put volumes and substantial Open Interest (OI) accumulation on the lower strike range. This downside OI build-up indicates increased demand for hedging, potentially exerting pressure toward key support levels. However, if these technical zones hold, the setup could offer contrarian long opportunities. In the case of Cipla Ltd and GMR Airport, the recent spike in Call OI relative to their respective 52-week highs merits a cautious view. The positioning may be indicative of Call writing rather than aggressive long exposure, implying overhead supply and potential resistance at higher price bands. Meanwhile, Shriram Finance and Suzlon Energy are witnessing sustained Put OI accumulation near their annual peaks, reinforcing the prevailing defensive sentiment. This pattern reflects persistent concerns around downside risk and underscores the market’s inclination toward protective strategies. (This data covers only stock options with at least 500 contracts traded on the day for both calls and puts).

Participant-wise Open Interest Net Activity:

In the index futures segment, a robust influx of 9,137 contracts by Retail Clients dramatically contrasts with the substantial divestment of 6,154 and 3,586 contracts by Foreign Institutional Investors (FIIs) and Proprietary Desks, respectively, culminating in a net market shift of 9,740 contracts. This juxtaposition reveals a divergent directional bias, as Retail conviction surged amidst institutional de-risking. Conversely, the stock futures arena saw an exceptionally aggressive reduction of 18,358 contracts by FIIs, which was significantly cushioned by Retail and Proprietary desks adding 6,117 and 8,862 contracts, respectively, accounting for the overall 18,358 contract change. The acute liquidation by FIIs here suggests a sector-specific bearish stance or profit-taking, even as other key market players selectively accumulated positions. 

Securities in Ban for Trade Date 04-November-2025: NIL

Nifty

Bank Nifty

Stocks with High IVR:

Stocks with Low IVR:

Stocks With High IVP:

Stocks With Low IVP:

For More Axis Securities Disclaimer https://simplehai.axisdirect.in/disclaimer-home

SEBI Registration number is INZ000161633