Budget 2019: Nifty Futures Hint At Caution Going Into Budget
Derivatives traders are a tad cautious going into the budget day.
Even though Finance Minister Piyush Goyal will present budget four months, at least some preferred to square off their outstanding positions at the end of expiry on Thursday.
The open interest, or the value of outstanding contracts, for Nifty 50 February Futures is 20 percent lower at Rs 18,671.665 crore at the start of the month compared with Rs 23,589 crore at the beginning of January series, according to data collated by BloombergQuint. Compared to beginning of the February 2018 series (last budget) when the outstanding positions in Nifty Futures was Rs 27,266 crore, the outstanding positions are lower by 31.5 percent.
About 62.8 percent of the contracts were rolled over in the futures and options market, with the percentage being 82.9 percent for futures alone. That compares to with overall rollover of 59.2 percent and futures rollover of 81 percent from December to January. The overall rise in the rollover was a reflection of higher positions being taken in the stock futures. Traders preferred to bring down speculative trades in the Nifty Futures while continuing to take stock specific calls.
The total F&O open interest going into the budget on Feb. 1 is 2.6 percent lower at Rs 128,201 crore. But open interest in stock futures has increased, especially in Nifty bank and stock futures. Of the top 10 open interest in futures, excluding the Nifty Futures, Bank Nifty and six bank stock futures saw increased positions going into the next series.