Derivative trading shows a shift towards bullish sentiment, with Put Writers increasing its position significantly. i | Photo Credit: Istockphoto
The domestic market is expected to open flat positively on Tuesday amid a mix of global queues. The weakness of IIP data and company outcomes continue to put the market under pressure, analysts said. However, large purchases by foreign portfolio investors and domestic institutions will keep the market in the consolidation stage.
Chief Economist & Head – Aditi Nayar, ICRA Ltd, Research & Autreach, said: “IIP growth in March 2025 was slightly lower than the 3.3% forecast. The low response rate associated with pre-measurements of data releases may have attenuated the estimated growth rate. She added that electricity and mild rises in manufacturing were largely offset by mining growth dips.
Meanwhile, Kotak Institution’s shares stated: Recent rebounds in the market reflect a degree of self-satisfaction and optimism in the market regarding global growth and domestic revenues. “In our view, there is still great uncertainty in the key issues (global growth, tariffs/trade, US dollars) that shape optimism around global and domestic markets and market revenues.
“The fact that the market is trading above the ‘liberation date’ level suggests that all issues are fixed. In reality, there is a high possibility that Flobal and domestic GDP growth will likely be low, mutual tariffs and trade issues will take a long time to resolve further, and revenues continue to be abundant across sectors and businesses.
Derivative trading shows a positive outlook, analysts said.
Dhupesh Dhameja, Samco Securities of Derivatives Research Analyst, said the option setup reflects a gradual shift in market sentiment from careful to confidence. “Put Writers has aggressively expanded their positions and overtakes positive signs of call writer-bully bets. At 24,500 strikes, there was intense interest (1.06 crore contract), while at the same time, 24,000 strikes witnessed solid put writing (1.24 crore contract).
“The put-call ratio (PCR) has risen sharply from 0.70 to 1.17, suggesting a significant shift to bullish emotions. The biggest pain centers around 24,200, implying a range-bound bias for now, with an upward tilt unless the breakout is materialized,” he added.
India’s VIX eased from 1.27% to 16.94, reflecting a slight decline in volatility. However, given global macro queuing, volatility could skyrocket unexpectedly. While Vix remains in a manageable band, staying above the psychological 15 mark suggests that traders should remain vigilant due to volatile daytime swings and whipping, he said.
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Released on April 29, 2025
