MUMBAI: Selling pressure was prevalent in the market despite a strong opening on Monday. The Nifty June futures ended with a 20-point discount to the spot, reflection of short build-up, analysts said.

However, bears are not in yet, said Zeal Mehta of Emkay Shares. “This is just a correction as I see there is very strong support at 4200 levels. There is a strong build up of puts at these levels,” he added. The 4200 put options have seen a build-up of around 50 lakh positions, accounting for 38% of market wide open interest in put options.  Bank Nifty June futures were in the thick of action.

The contract saw an open interest build up of 23%. It appreciated by .5% but closed at a 33 point discount to spot. Over 3000 contracts were traded for a turnover of Rs 98 crore. “Bank Nifty has added a huge amount of long positions, which is good for banking stocks. This correction should be used by investors to buy banking stocks,” Zeal of Emkay said.

A long build-up in Bank Nifty futures means traders are willing to buy Nifty at a future date. This is likely to push up prices of banking stocks in cash segment, since the prices of cash and derivatives converge on maturity of the contract.