As concerns escalate over the ongoing conflict between India and Pakistan, the stock market experienced a downturn. For the week concluding on May 9, 2024, the Nifty-50 index faced a decline of approximately 1.4%. The Bank Nifty index fell by 2.6%, settling at 53,595.25. While sectors like real estate, pharmaceuticals, and utilities struggled, both the automotive and industrial sectors managed to show resilience.
Market Sentiment and Technical Analysis
The current market outlook suggests that if the Nifty index remains below the 24,150 mark, investor sentiment is likely to remain weak, with potential retests of 23,800 and 23,600 levels. Conversely, a rise above 24,150 could trigger a recovery rally, pushing the index towards 24,350 to 24,450, according to insights from Amol Athawale, Vice President of Technical Research at Kotak Securities.
For the Bank Nifty, the 20-day Simple Moving Average (SMA) at 54,000 will serve as a crucial indicator for short-term traders, as noted by Athawale.
Global Influences and Earnings Reports
Geopolitical tensions, particularly those related to Pakistan, are expected to influence market behavior significantly. On the economic front, traders will be vigilant about upcoming data releases, such as the Consumer Price Index (CPI) and Wholesale Price Index (WPI), along with trade statistics. Ajit Mishra, Senior Vice President of Research at Religare Broking Ltd, emphasized that these indicators will be pivotal for investors.
Furthermore, the earnings season is heating up, with major companies like PVR INOX, Tata Steel, Bharti Airtel, Cipla, GAIL, Hero MotoCorp, Tata Motors, Lupin, Godrej Industries, and BHEL preparing to disclose their quarterly results.
Stock Recommendations for Today
In light of the current market dynamics, Sumeet Bagadia, Executive Director at Choice Broking, has put forth two stock recommendations. Additionally, Ganesh Dongre, Senior Manager of Technical Research at Anand Rathi, has suggested three stocks to consider.
Sumeet Bagadia’s Picks
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Redington Ltd
- Buy at: ₹259.35
- Stop Loss: ₹248
- Target Price: ₹285
- Redington has shown a robust bullish trend, recently forming a bullish engulfing pattern on its daily chart. A breakout above ₹265 could further solidify the positive momentum, supported by increasing trading volumes.
- LT Foods
- Buy at: ₹359.55
- Stop Loss: ₹346
- Target Price: ₹385
- LT Foods is on the verge of breaking out from a falling trendline, suggesting a potential bullish reversal. This is backed by rising trading volumes, indicating strong market interest.
Ganesh Dongre’s Selections
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JSW Steel
- Buy at: ₹957
- Stop Loss: ₹945
- Target Price: ₹972
- JSW Steel has demonstrated consistent bullish movement, maintaining above critical support at ₹945. The current market dynamics suggest a favorable entry point for traders.
-
Chambal Fertilisers & Chemicals Ltd
- Buy at: ₹695
- Stop Loss: ₹675
- Target Price: ₹720
- Chambal Fertilisers shows a promising bullish reversal pattern, making it an attractive option for short-term traders aiming for a price increase towards ₹720.
- Sun Pharmaceutical Industries Ltd
- Buy at: ₹1,745
- Stop Loss: ₹1,720
- Target Price: ₹1,790
- Sun Pharma appears oversold, with a bullish reversal pattern suggesting a recovery is imminent. The key support level at ₹1,720 serves as an important stop-loss point for this trade.
Conclusion
As market dynamics shift amidst geopolitical tensions and corporate earnings reports, traders should stay informed and consider the recommended stocks for potential gains. Keeping an eye on critical levels and technical indicators will be essential for navigating the current landscape.
