Stock Market News: The domestic benchmark equity indices, the Sensex and the Nifty 50, ended the day higher for the third straight session on Friday amid mixed global cues.
On Friday’s session, the 30-share BSE Sensex ended higher by 190.75 points or 0.26% at 72,831.94 level while the Nifty 50 closed at 22,096.75 level, up 84.80 points or 0.39%.
Also Read: Stock market today: Nifty 50, Sensex end higher for the third consecutive session; investors earn over ₹2 lakh crore
Stocks rebounded last week, RECovering from a previous decline. The Federal Open Market Committee’s (FOMC) dovish remarks helped most sectors gain momentum, said Santosh Meena, Head of Research at Swastika Investmart Ltd. With gains of almost 5%, real estate, auto, and metal companies were the biggest gainers. The information technology (IT) sector, on the other hand, reversed the trend and fell more than 6% when Accenture lowered its forecast.
The broader market provided solace, as indices for small- and mid-cap companies also had notable rallies. The Nifty Midcap index, in particular, made a significant recovery from its 100-day moving average (DMA), explained Meena.
The upcoming week will be a truncated trading week as the domestic equity market will be closed on Monday in celebration of the Holi festival and on Friday on account of Good Friday.
Also Read: Stock market holidays in March 2024: BSE, NSE to remain closed on Holi, Good Friday
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Market Outlook by Dharmesh Shah, Vice President, ICICI Securities
In line with our view, supportive efforts emerged in the vicinity of 21,800 coincided with 50 days EMA that helped the index recover intra-week losses and settled the session above the 22,000 mark. Going ahead, we expect the index to gradually resolve higher and head towards life highs of 22,500 in the coming months. In the process, bouts of volatility would offer incremental buying opportunity. Thus, buying on dips would be the prudent strategy to adopt, as strong support is placed at 21,700, which we expect to hold, advised Dharmesh Shah, Vice President, ICICI Securities.
Also Read: Dividend Stocks: REC, SBI Cards & Payments, CRISIL, among others to trade ex-dividend next week; check full list
Shah’s positive bias is further validated by following observations:
A) BankNifty has shown resilience in the face of recent volatility as it has undergone a healthy retracement wherein it retraced 50% of the preceding four week’s up move and closed above the 20 days EMA, suggesting a revival of upward momentum that makes us believe the index would head towards 48,000 in the coming month, wherein strong support is placed at 46,000. The robust price structure of heavy-weight banking constituents signifies inherent strength that bodes well for the next leg of up move.
B) Since CY18, on nine out of eleven occasions, mean reversion towards the 50 days EMA, along with market breadth approaching bearish extremes, has offered fresh entry opportunity. Even in the current scenario, % of stocks above the 50 days SMA of the Nifty 500 universe bounced from 20 levels (oversold zone).
C) Buoyancy in global peers bodes well for positive momentum in the domestic market as the Nikkei hit new life-time highs despite the first rate hike in 15 years. US and European indices gained >2% each to hit new highs.
Also Read: Over 50 smallcap stocks log double-digit growth as broader indices gain 1.5%; Reliance Infra, BEML among gainers
Stock Recommendations by Dharmesh Shah
On stocks to buy next week, Dharmesh Shah recommended two stocks:
Buy Life Insurance Corporation of India (LIC) in the range of ₹888–908 for the target of ₹1,030 with a stop loss of ₹824.
Buy ABB India Ltd in the range of ₹5,900–5,960 for the target of ₹6,550 with a stop loss of ₹5,560.
Also Read: FPIs pump ₹38,098 crore in Indian equities, debt inflows at ₹13,223 crore; Will the trend continue in FY25?
Disclaimer: The Research Analyst or his relatives or I-Sec do not have actual/beneficial ownership of 1% or more securities of the subject company, at the end of 22/03/2024 (preceding date) or have no other financial interest and do not have any material conflict of interest.
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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Omprakash Tiwary is a business writer who delves into the intricacies of the corporate world. With a focus on finance and economic landscape. He offers readers valuable insights into market trends, entrepreneurship, and economic developments.
