Stock market today: The domestic benchmark indices, Nifty 50 and Sensex, entered a consolidation phase on Thursday, with the indices opening nearly unchanged, while IT stocks faced downward pressure and silver prices dropped significantly.
Investor caution followed the recent upswing prompted by the India-US agreement, amid emerging concerns affecting certain sectors.
The Nifty 50 index began the day at 25,755.90, declining by 20.10 points or 0.08%, whereas the Sensex started at 83,757.54, falling by 60.15 points or 0.07%. The stagnant opening reflected a consolidation trend at the index level following the recent increases.
In the broader market on the National Stock Exchange (NSE), the Nifty 100 index fell 0.12%. The Nifty Midcap 100 recorded a small loss of 0.04%, while the Nifty Smallcap index fell by 0.31%.
The sectoral indices on the NSE exhibited a varied performance. The Nifty Auto index rose by 0.20%, bolstered by expectations of consistent domestic demand. Conversely, the Nifty IT index fell by 0.36%, while the Nifty Metal index dropped by 1.71%.
Nifty 50 Outlook by Osho Krishan, Sr. Analyst, Technical & Derivatives, Angel One
On Tuesday, Nifty 50 witnessed a sharp gap-up opening of around 1,200 points, but the absence of follow-up buying led to some cooling off, resulting in the formation of a large black-bodied candle on the daily chart.
Despite this formation, prices ended with strong gains and continued to trade comfortably above key moving averages, indicating that the overall undertone remains positive.
Historically, when markets mark a pivotal low around a major event such as the Union Budget, it often acts as an important medium-term bottom, post which prices tend to move higher.
With major events now behind us and after the sharp upmove earlier this week, the index is likely to enter a phase of consolidation with an upward bias.
Technically, yesterday’s rebound was seen precisely from the key 89EMA support near 25,550, which is expected to act as immediate support. This is followed by a stronger support zone around 25,250, which coincides with the 61.8% retracement of the sharp rally from the Budget-day low, the bullish gap area, and the 200DSMA.
As long as these supports hold, the positive bias remains intact. On the upside, the 26,000 mark is seen as an immediate resistance, followed by a major hurdle around 26,300.
Traders are advised to keep a close watch on these levels and adopt a strategy of buying near supports and booking profits near resistance. While the benchmark index may consolidate in the near term, selective stocks, especially those benefiting from the recent Budget announcements and the India-US trade deal, are likely to continue offering outperformance opportunities.
Stocks To Buy on Thursday- Osho Krishan
On stocks to buy on Thursday, Osho Krishan of Angel One recommended two stocks – REC Ltd, and Gujarat Mineral Development Corporation Ltd (GMDC).
REC Ltd has witnessed a decent buying traction in the recent period and has surged towards the 200 DEMA after an extended period of a corrective phase. In the recent sessions, the strong rebound from the oversold parameters, followed by positive divergence in price and 14-day RSI, has reinstated buying momentum in the counter. The risk-reward seems favorable, and a strong momentum is likely to be seen in the near term.
Hence, we recommend a BUY in REC shares around ₹375 with a stop loss of ₹360 and a target of ₹400.
GMDC Ltd has shown a rebound from the 100 DEMA in recent sessions and has surged towards its lifetime high zone. From a technical perspective, the MACD histogram has shown a positive crossover from the zero line, suggesting a potential breakthrough from its sloping trendline to enter uncharted territory. Furthermore, the cycle of higher lows structure adds to the buoyant undertone.
Hence, we recommend a BUY in GMDC shares around ₹610 with a stop loss of ₹570 and a target of ₹670-680.
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.
