The 30-share BSE Sensex opened higher by 495.48 points or 0.65% at 77,102.05 level while the Nifty 50 started off at 23,480.95 level, up 158 points or 0.68%.
According to Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, there is excellent news on inflation in both the US and India. In May, US CPI inflation fell somewhat less than projected to 3.3%, while MoM inflation remained unchanged. However, the economy remains solid, and there are no significant signs of labour market easing. As a result, Fed Chairman Jerome Powell has held interest rates constant and hinted at only one rate decrease in 2024, with a possible four in 2025.
In May, India’s CPI inflation fell to 4.75%, but core inflation was only 3.1%. This prepares the door for the MPC to lower rates in October.
Nifty 50 Outlook by Osho Krishan, Sr. Analyst, Technical & Derivatives, Angel One
The Nifty 50 benchmark index had a positive start today, swiftly climbing above 23,400 within the first few minutes to set new all-time highs. However, akin to the last two sessions, follow-up buying at higher levels was lacking, resulting in prices fluctuating within a narrow range of around 50 points for most of the day. Eventually, towards the end, profit-taking prompted a partial reversal of morning gains, resulting in a modest 0.25% increase, with the market closing at 23,323, said Osho Krishan, Sr. Analyst, Technical & Derivatives, Angel One.
After numerous attempts in recent sessions, prices finally breached the 23,300 mark on a closing basis. Yet, a closer look at the daily chart reveals a series of three small-bodied candles, signalling hesitancy at higher levels with a notable absence of sustained buying throughout the week. The range between 23,400 and 23,500 has emerged as a formidable resistance zone, consistently stalling morning upswings. Breaking through this zone remains crucial for triggering a fresh positive momentum, particularly for the weekly expiry, while 23,200 serves as a pivotal support level. Traders are advised to monitor this key range of 23,200 – 23,500 closely, as a breakout could spark a significant movement on expiry day, warranting strategic trade placement, explained Krishan.
Amidst this backdrop, the notable performance of midcap and small-cap stocks in recent sessions stands out, urging traders to identify such counters for potentially strong trending opportunities. Nonetheless, caution is advised against aggressive bets, especially in the current elevated market environment. As highlighted in the previous outlook, with major domestic events behind us, market direction is likely to align with global cues, necessitating vigilance on international developments, added Osho.
Top Stock Recommendations For Thursday by Osho Krishan
On stocks to buy today, Osho Krishan recommended two stocks – SBI Life Insurance Company Ltd, and AIA Engineering Ltd.
SBI Life Insurance Company Ltd
SBI Life has experienced a notable downturn from its peak of 1,570 to around 1300 over the last three months, re-testing its broader term breakout. However, in the past few trading weeks, the stock has been consolidating near the 200 SMA and has begun to show signs of gaining momentum, potentially signalling an early stage of reversal. On the oscillator front, MACD and 14 period RSI are showcasing a reversal in the trend from the oversold territory, suggesting a lucrative risk-reward ratio in the counter from the short to medium-term time frame.
“Hence, we recommend to BUY SBI Life around ₹1,440 keeping a stop loss of ₹1,390 for a potential target of ₹1,500-1,520,” said Osho.
AIA Engineering Ltd
AIA Engineering witnessed a substantial increase in price volume in the last couple of trading sessions from the crucial zone of 200 SMA on the daily chart. Additionally, the counter has soared above all its major EMAs, breaching the sloping trend line of the recent two swing highs. From a technical standpoint, the counter has reversed from critical support, which historically has proved its mettle. On the oscillator front, 14-period RSI and MACD both signal a continuation move, suggesting a potential upside journey in a comparable period.
“Hence, we recommend to BUY AIA Engineering around ₹3,800 keeping a stop loss of ₹3,620 for a potential target of ₹4,100-4,140,” said Krishan.
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 decisions.
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Published: 13 Jun 2024, 10:00 AM IST