Outlook for Today
Nifty posts decent gains but along with nearly 10% rise in participation with deteriorating basis, indicating creation of hedges. This fact is also signified by an addition of nearly 5mn shares in last two sessions in at the money puts. On the other hand the stock futures have been adding participation through the rally with on an average higher cost of carry indicating long bias among fresh additions. Specifically, Smaller Banks may post meaningful gains after continuing long additions. As of now, the outlook still remains moderately bullish where the lower IVs in Nifty options do not indicate any large price correction.
