Last week, some degree of short covering and value purchasing in the majority of battered quality firms, including index heavyweights, contributed to the market’s rise. The BSE Sensex advanced 589.31 points to 57,696.46, while the Nifty50 gained 170.25 points to 17,196.70. The broader markets also rebounded, with the BSE Midcap and Smallcap indices increasing approximately 1.35 percent and 1.25 percent, respectively.
This week, the market, according to most analysts, is projected to remain turbulent in the coming week as well, owing to the Monetary Policy Committee meeting, uncertainties surrounding Omicron, and economic data.
The biggest threat being Omicron.
Omicron A new version of Covid Omicron, which originated in South Africa and has since expanded to over 30 nations, including India, instilled dread in investors and traders last week and is anticipated to do so again this week. India has now reported the return of a fourth Omicron patient from South Africa, prompting a tightening of Covid restrictions across the country, despite overall Coronavirus cases are under control, with India reporting less than 10,000 daily cases for more than a week.
Initial Public Offerings & Listings
The following week will see a torrent of initial public offerings (IPOs), as four companies – RateGain Travel Technologies, Metro Brands, Shriram Properties, and CE Info Systems (MapmyIndia) – will begin accepting subscriptions.
RateGain Travel Tech, India’s largest Software as a Service (SaaS) company in the hospitality and travel industries, will launch its Rs 1,335.73-crore initial public offering (IPO) on December 7-9, with a price band of Rs 405-425 per share, while Metro Brands, backed by ace investor Rakesh Jhunjhunwala, will launch its IPO on December 10-14, 2021.
CE Info Systems (MapmyIndia), India’s leading map and navigation services provider, will open its initial public offering for subscription between December 9 and December 13, while Shriram Properties, a South-based real estate developer, will open its maiden public offering for subscription between December 8 and 10, with a price band of Rs 113-118 per share.
Reserve Bank of India Policy
The Monetary Policy Committee will announce its interest rate decision on Wednesday, following a three-day meeting. The market will be watching the RBI’s reaction to the present Omicron problem, economic growth, inflation data, and a hawkish US Federal Reserve. Experts believe the central bank might narrow the spread between the repo and reverse repo rates and maintain VRRR (variable rate reverse repo).
FII Action
FIIs kept their finger on the sell button for another week ended December 3 because to Omicron uncertainty and expectations of accelerated Fed tapering, however DIIs more than offset the FII selling pressure. Experts believe that FIIs’ behaviour will be essential in determining the market’s path.
Foreign institutional investors net sold shares for Rs 15,800 crore, whereas domestic institutional investors net acquired shares worth Rs 16,450 crore during the week, outpacing FII outflows.
Technical View
The weekly view is simple – the markets on a weekly basis crossed Weekly R2, back in August, went as high as to hit the R3 and has since then come crashing. Last week the prices did dip below the previous week’s low, however, could manage to stay afloat. This week is important – unless 17500 is crossed, we should not expect any upside, and if last week’s low is broken – we could very well see even 15900 – at least as an intraday bottom.
The daily chart shows rejection at 17500 and also buy below 1700 levels. – we can expect market to consolidate here for sometime, and all depends on the omicron spread – we know and we are prepared for a highly infectious spread of the virus.
Bhoi Smrutirekha Dharanidhar