Sectoral shift likely in August series

Rollover Analysis

Overall Outlook

 

The July series began on a strong note and saw steady gains and finally the index managed to close at 7721 netting gains of 228 pts for the series. The banking stocks and rate sensitives saw some profit-taking. The IT and pharma sectors saw some recovery after being in the shadow for the past 2 months. The Nifty has settled in the 7700-7800 range in the last few weeks though closing near the lower band for the series .Mixed corporate results has seen some strong shift. The capital goods sector n particular has shown strong profit-taking. Overall caution is advised at higher levels as the last few months have already seen a dream run up.

 

NIFTY

 

The Nifty saw rollover of 63 % compared to 68% in the previous month. The rollover was also higher compared to the 3-month average (60.5%) and the 6-month average (60.5%). This has been at a premium of 29 basis points as compared to 41 points in the previous month. However the point to note was the lighter quantum of Nifty futures to begin with which was at 13.21 mn compared to 14.21 mn in the beginning of July series.

 

Market-wide rolls were at 82 % vs previous month’s 83 and the 3-month average of 81%.

BANK NIFTY

 

The index saw rolls of 57% compared to 63% in the previous month. Rollover has been at a premium of 83 points compared to 162 points in the July series. Again lighter quantum of Bank Nifty futures to begin with which was at 0.9 mn compared to 1.1 mn in the beginning of July series hinting at possible shorts.

 

Some notable long /short rollovers have been identified which have been presented below:-

 

Bharti – The scrip saw lower rolls of 63% against 81% in the previous month, 3-mnth average (75%) and 6-mnth average (74%). The lower rolls is on the back of absence of short rolls. Buying could be considered at declines for a possible target of 400.

 

ABNuvo -The scrip saw rolls of 96% against 88% in the previous month, 3-mnth average (85%) and 6-mnth average (84%). Buying could be considered at declines for a possible target of 1540.

 

Titan-The scrip saw rolls of 93% against 82 % in the previous month, 3-mnth average (81%) and 6-mnth average (81%). Buying could be considered at declines for a possible target of 362.

 

Arvind – The  scrip saw rolls of 80% against 57 % in the previous month, 3-mnth average (72%) and 6-mnth average (75%). Buying could be considered at declines for a possible target of 248.

 

UltraTech– The scrip saw rolls of 76% against 66 % in the previous month; 3-mnth average (67%) and 6-mnth average (71%). The bias was on the short side, Selling could be considered around 2500-2520 for a possible target of 2275

 

Hindpetro – The scrip saw rolls of 72% against 3-month average of 85% indicates cut down in short positions in Aug series. The stock can bought around 400 for a possible target of 425 in the short term.

 

Jpassociate – The scrip saw rolls of 76% against 88 % in the previous month, 3-mnth average (85%) and 6-mnth average (81%). The cut down in open interest indicates short positions not rolled. Buying could be considered at declines for a possible target of 70.

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