India VIX Falls After Five-Day Rally as Nifty Climbs to Record

The benchmark gauge of Indian option prices declined, halting its longest rising streak in more than four months, as the CNX Nifty Index climbed to an all-time high.

The India VIX Index, a measure of protection against stock market swings, fell 1.3 percent to 13.93 at the close in Mumbai after a five-day rally. The gauge jumped as much as 22 percent intraday and changed direction at least 12 times today. The 50-stock Nifty added 0.1 percent to 8,344.25 after falling as much as 0.4 percent. The Nifty 8,400 call, the most-active index options contract by volume, slumped 6.3 percent to 73.1.

“Volatility is coming off a bit as there are no major event triggers,” Manoj Vayalar, assistant vice president of derivatives at Religare Securities Ltd. in Mumbai, said in a phone interview. “We advise selling calls as the Nifty has run up a lot.”

The Nifty extended a three-week rally after Prime Minister Narendra Modi expanded his cabinet for the first time since taking office in May, as he seeks to attract foreign investment and boost growth in Asia’s third-largest economy. Manohar Parrikar became defense minister, allowing Finance Minister Arun Jaitley, who previously also held the portfolio, to focus solely on spurring the economy.

The Nifty has risen 32 percent this year after foreign investors injected $14.4 billion into local stocks, the most among eight Asian markets tracked by Bloomberg.

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