Employees walk past an electronic board that indicates the latest stock figures at the the National Stock Exchange (NSE) in Mumbai, India (Photographer: Dhiraj Singh/Bloomberg) 

Traders Unwind Long Positions As Nifty Fails To Hold 8,100-Mark

Selling pressure returned to Indian equity markets as the NSE’s Nifty 50 index retreated by 1.3 percent to close below 8,100-mark on Friday. Long positions in its December futures were unwound with its open interest declining by 2.3 percent.

The Nifty Bank index, which fell by 0.8 percent, saw an addition of 3.7 percent in its futures open interest indicating fresh shorts.

Foreign institutional investors bought index futures worth Rs 242 crore on a net basis.

The India Volatility Index (VIX) surged 7.5 percent to close 17.9, indicating an expansion in option premiums as a result of the sharp fall in major indices.

The 8,200 put saw the most activity with unwinding of 7.4 lakh shares in open interest.

As the Nifty fell below 8,100, the 8,200 call saw writing with an addition of 5.9 lakh shares in open interest. Maximum open interest remained with 8,300 call and the 8,000 put, which indicates the near-term range for the Nifty.

FIIs bought 10,723 index puts against 1,753 index calls on a net basis pointing to a near-term bearish view.

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