Will markets extend rally amid tepid global cues? 5 things to know before today’s opening bell

Initial Public offer (IPO) of C.E. Info systems Ltd. (CIES), a data and technology products and platforms company which owns the MapmyIndia portal, will open for subscription.
(Image REUTERS)

By Harshita Tyagi

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NSE Nifty 50 and Bank Nifty index look to continue the momentum today after bulls pushed Indian share markets higher on Wednesday. S&P BSE Sensex zoomed 1,016 points or 1.76% to close at 58,649 on Wednesday, while the NSE Nifty 50 added 1.71% to settle at 17,469. Bank Nifty index jumped 1.82%, regaining 37,200 levels. All the sectors contributed to the up move. “The banking space could continue to lead the momentum as the Bank Nifty index has seen good interest from its 200 DMA support. Nifty could continue this momentum towards its hourly 200 EMA which is placed around 17550. Traders with long positions can look to book profits around 17550-17600 and wait for further signs,” said Ruchit Jain, Trading Strategist, 5paisa.com

Key things to watch out for before opening bell

Global cues:

Asia-Pacific markets were mostly muted in early trade Thursday (9 December) as investors assessed Omicron Covid variant surrounded risks. Japan’s Nikkei 225 dipped 0.04% while the Topix index slipped 0.08%. In Australia, the ASX 200 declined 0.11% as the energy and materials subindexes were down 0.26% and 0.1%. South Korean shares advanced, with the benchmark index Kospi up 0.19% and the Kosdaq higher by 0.56%.

Levels to watch out for

Nifty is currently placed at the crucial overhead resistance of 17500-17550 levels, which is previous swing highs and lows as per the concept of change in polarity. This area has proved to be a crucial value area as the Nifty moved down sharply below this area for two occasions in the past, said Nagaraj Shetti, Technical Research Analyst, HDFC Securities.

A decisive move above 17550-17600 levels could open further sharp upside towards 18K mark in a quick period of time. Any failure to sustain above this area is likely to trigger weakness from the highs towards the low of 17250-17200 levels in the near term, he added.

Maintain buy on dips strategy

Nifty Bank was one of the big drivers for the market, rising 666.30 points or 1.82 percent to 37,284.70 on December 8. Siddhartha Khemka, Head – Retail Research, Motilal Oswal Financial Services Ltd. said, “Both Nifty and Bank Nifty are recovering well from the recent correction. Strength is clearly visible along with strong buying interest in the market. Hence traders are advised to maintain buy on dips strategy for the next few days,”

Stocks under F&O ban on NSE

Indiabulls Housing Finance stock is under the F&O ban for today (9 December). Securities in the ban period under the F&O segment include companies in which the security has crossed 95 per cent of the market-wide position limit. All clients/members are to trade in the derivative contracts of Indiabulls Housing Finance security only to decrease their positions through offsetting positions. Any increase in open positions to attract appropriate penal and disciplinary action.

IPO Watch

Initial Public offer (IPO) of C.E. Info systems Ltd. (CIES), a data and technology products and platforms company which owns the MapmyIndia portal, will open for subscription on 9 December and close on December 13. Shares are likely to be listed on stock exchanges BSE and NSE on December 21. CE Info Systems shares will be available for bidding in a price band of Rs 1,000-1,033 per share. The IPO is an OFS of more than one crore shares, estimated at Rs 1,039.6 crore at the upper end of the price band.

Arihant Capital in its report on C.E. Info systems IPO, recommended to ‘Subscribe for long term’. “At the upper price band of INR 1,033 the issue is priced at a P/E multiple of 94x based on the FY21 EPS of INR 11. CEIS is the market leader in the digital maps and geospatial software industry, effectively creating an entry barrier against potential competition. Its long standing relationships with high value clients not only generate repeat sales, but also encourage cross- selling and up- selling. The company has strong fundamentals, and it’s profitability is expected to inch up going further. Hence, we recommend that investors Subscribe to the issue for the long term,” it said.