Stock Market News: The domestic benchmark indices, Sensex and Nifty 50 saw continued selling pressure on Wednesday for the third consecutive day this week, with the bears consistently driving down the indices.
Nifty 50 opened at 24,378.15, reflecting a decrease of 93.95 points or 0.38%, while the Sensex opened at 79,921.13, down by 299 points or 0.37%.
It was highlighted by experts that while the long-term outlook for Indian stocks remains positive, the current market sell-off is attributed to uncontrollable global events.
According to Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, the current pattern of largecaps outperforming mid and smallcaps is probably going to continue. It’s likely that FII selling and the opposing trend of DII buying will continue. Largecap financials, especially banking stocks like HDFC, ICICI, Axis, and Kotak, which are fairly valued in this market with inflated valuations, will benefit from this. The market will be anticipating the results of the US presidential election and how they might affect the market in the days ahead.
Nifty 50 Outlook by Sagar Doshi, Senior Vice President- Research, Nuvama Professional Clients Group
Nifty 50 has given a breakdown on a bearish head and shoulder pattern formation daily charts. This pattern indicates a reversal of the ongoing uptrend in the index. Targets for the same stand at 24,225 / 23,800 on the downside while negation of the same stand at 24,900. Any rise towards 24,650 is likely to get sold into for lower targets. Weakness is largely impacted global uncertainty on the gulf zone adding to due to stricter and periodic comments by the securities market regulator domestically topped up with record $10 billion outflow from the cash market by FII’s so far in the past 3 weeks of trade.
Bank Nifty
Bank Nifty is currently holding at a 1 year trendline support which reads at 51,180. If this breaks on a closing basis, it could allow initial target on the index to slip for 1,200-1,500 point move on downside. 51,180 is an important level on daily charts to act as a support reversal buy. Further pressure could emerge from here only on break of 51,180 on downside which could push the index in favour of bears for targets allowing a drop all the way for 50,000 / 49,500 on the downside.
Stocks To Buy or Sell on Wednesday – Sagar Doshi
On stocks to buy or Sell on Wednesday, Sagar Doshi of Nuvama recommended three stocks – ICICI Bank, Hindustan Zinc Ltd, and Varun Beverages Ltd.
ICICI Bank (Buy) LCP : ₹1,267; Stop Loss : ₹1,230; Target Price : ₹1,350
Stock is showing strong strength against broader market weakness. Once market stabilises, such stocks tend to outperform. Stock is respecting key moving averages on all major timeframes.
Hindustan Zinc Ltd (Buy) LCP : ₹513.60; Stop Loss : ₹490; Target Price : ₹580
Stock is forming a huge base after a very strong run up. Such consolidation in a tight range provides favourable risk to reward. A move over 525-530 will lead to strong upside momentum.
Varun Beverages Ltd (Buy) LCP : ₹594; Stop Loss : ₹570; Target Price : ₹675
Stock has formed a bullish reversal candle on daily timeframe with strong volumes. Such candle on a broader weak day hints towards future out performance.
Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decision