Despite strong buying in banking stocks, the Indian stock market continued its downtrend on Thursday, marking the fifth straight session of losses. The Nifty 50 index declined by 216 points, closing at 22,488, while the BSE Sensex dropped 617 points, ending at 73,885. However, the Bank Nifty index bucked the trend, gaining 181 points to close at 48,682. In the broader market, the mid-cap index fell by 1.21%, and the small-cap index nosedived by 1.33%.
Trade Setup for Friday
Rupak De, Senior Technical Analyst at LKP Securities, commented on the volatile nature of the Nifty 50 index, which closed below the crucial 21-day Exponential Moving Average (21EMA). He noted significant call writing at the 22,500 level, indicating that Nifty needs to sustain above this level to signal a recovery. Failure to do so could lead to fresh selling, potentially pushing the index down to 22,300 or 22,100.
Bank Nifty Outlook
Neeraj Sharma, AVP Technical and Derivatives Research at Asit C Mehta, observed that despite a negative opening, the Bank Nifty managed a strong recovery, ending positively at 48,682. Technically, the index has support at 48,000 and resistance around 49,000-49,050. Sustaining above 49,050 could extend the rally towards 49,690 and 50,000.
Market Sentiment
Siddhartha Khemka, Head of Retail Research at Motilal Oswal, highlighted that nervousness ahead of the exit polls on June 1 and weak global cues are affecting market sentiment. Rising bond yields globally and diminished hopes for a rate cut are adding to the pressure, with expectations of heightened volatility as the general election outcome approaches.
India VIX Update
Sumeet Bagadia, Executive Director at Choice Broking, noted the rise in the India VIX Index, which breached the 23 mark and is now facing resistance at 25. A close above this level could lead to increased volatility, potentially pushing the index to 28 in the near term.
Stock Picks: Buy or Sell Recommendations
Market experts Sumeet Bagadia of Choice Broking and Ganesh Dongre of Anand Rathi shared their stock recommendations for today, highlighting five stocks to buy or sell:
Sumeet Bagadia’s Stock Picks
- Dixon Technologies
- Buy at ₹9308, Target ₹9900, Stop Loss ₹9000
- Dixon Technologies is showing strong bullish momentum, having recently broken out above ₹9000. The stock is trading above its 20-day, 50-day, and 200-day EMAs, indicating overall strength.
- Ujjivan Small Finance Bank
- Buy at ₹589.50, Target ₹630, Stop Loss ₹568
- Ujjivan has formed a Rounding Breakout pattern on the daily chart with increased trading volume. A sustained move above ₹590 could target ₹630, with support levels at ₹575 and ₹568 offering buy-on-dips opportunities.
Ganesh Dongre’s Stock Picks
- PNB Housing Finance
- Buy at ₹748, Target ₹780, Stop Loss ₹720
- PNB Housing Finance has support around ₹720 and shows reversal price action at ₹748, suggesting a potential rally to ₹780.
- BEL
- Buy at ₹290, Target ₹305, Stop Loss ₹282
- BEL is experiencing a short-term bullish reversal pattern. With support at ₹282, the stock could retrace to ₹305.
- Escorts
- Buy at ₹3856, Target ₹4050, Stop Loss ₹3780
- Escorts has support at ₹3780 and shows a reversal at ₹3856, indicating a potential rally to ₹4050.
Investors are advised to consider these recommendations and monitor the market conditions closely as the political and global economic landscapes continue to evolve.
