The Indian stock market experienced a significant boost on Friday, with the Sensex and Nifty 50 indices both climbing nearly 2%. This market surge was fueled by widespread buying activity following an announcement from U.S. President Donald Trump, who declared a 90-day pause on the 26% tariffs imposed on India. As a result, the Sensex rose by 1,294.77 points (or 1.75%), reaching 75,141.92, while the Nifty 50 gained 420 points (or 1.88%), hitting 22,819.15.
Market Drivers: Trump’s Decision
Analysts attribute this rally largely to Trump’s unexpected decision to postpone reciprocal tariffs on all trading partners—excluding China—for 90 days. This announcement has revitalized investor sentiment, leading to a robust market response.
On the technical front, the Nifty 50 index rebounded sharply after touching a low of 21,965, rallying nearly 1,000 points to close at 22,857.
- Key Observations:
- The strong bounce indicates a shift in control from bearish to bullish traders.
- The previous breakaway gap has transformed into a runaway gap, suggesting a solid bullish sentiment.
- Analysts predict that if the index sustains above 23,000, it could pave the way for a move towards 23,419—the breakdown level from earlier sessions.
Expert Insights on Future Trends
Anshul Jain, Head of Research at Lakshmishree Investment, highlighted that the current structure favors further upward movement, with any dips likely to be bought. He emphasized the importance of monitoring strength above 23,000 to confirm the next upward phase.
Top Stock Picks Amid the Rally
In light of the burgeoning market, Jain recommends several stocks for investors looking to capitalize on the upswing. Notably, three of the recommended stocks come from the HDFC Group. Jain believes these selections are well-positioned for significant growth. Here’s a closer look at the stocks to consider:
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Suzlon Energy
- Recommendation: Buy
- Target Price: ₹59 – ₹60
- Insight: The stock is forming a 48-day rectangle pattern with boundaries between ₹48 and ₹60. The failed breakdown last week indicates a shakeout, potentially allowing stronger hands to accumulate shares. A breakout above ₹54 could lead to a swift move towards ₹59-₹60.
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HDFC Bank
- Recommendation: Buy
- Target Price: ₹2,050
- Insight: Currently consolidating within a range of ₹1,680 – ₹1,840, HDFC Bank has faced resistance near ₹1,800 – ₹1,840. A decisive breakout above ₹1,840 may trigger a rally towards ₹2,050.
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HDFC Asset Management Company
- Recommendation: Buy
- Target Price: ₹4,500
- Insight: The stock has formed a 62-day rectangle pattern between ₹3,600 and ₹4,120. A failed breakdown near the lower boundary indicates potential short-covering. A breakout above ₹4,130 could lead to a significant rally towards ₹4,500.
- HDFC Life Insurance Company
- Recommendation: Buy
- Target Price: ₹755
- Insight: HDFC Life is forming a 95-day cup and handle pattern. A sustained move above ₹695-700 could unlock potential gains towards ₹755, contingent on strong volume support.
Conclusion
With a bullish trend taking hold, traders are encouraged to keep a close watch on these stocks, especially as the market looks poised for further gains. Keeping an eye on volume and price action will be crucial for validating breakout strength and confirming potential upward movements.
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