Top Stock Recommendations: Sagar Doshi of Nuvama recommends buying HDFC Bank, UPL, and Indian Oil Corporation today
- Top Stock Recommendations: Sagar Doshi of Nuvama Professional Clients Group recommends buying these three stocks today - HDFC Bank Ltd, UPL Ltd, and Indian Oil Corporation Ltd (IOC).
Stock Market News: Domestic equity benchmark indices, the Sensex and Nifty 50, began Wednesday's session lower, mirroring weak global cues and dragged by banking and information technology (IT) stocks following fresh data from the US that that sparked worries about the Federal Reserve postponing interest rate cuts.
At 9:15 IST, the BSE Sensex was down 0.20% to 73,757.23, while the blue-chip NSE Nifty 50 index was down 0.30% at 22,385.70.
Rising US bond yields (the 10-year is now at 4.36%) are having an effect on equities markets, according to Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services. Since the labour market remains tight and rising crude prices (Brent at $89) are considered to contribute to inflation, the Fed's capacity to lower interest rates—which was originally anticipated in July—is starting to wane.
Amidst mixed cues from global markets on Tuesday, the 30-share BSE Sensex ended lower by 110.64 points or 0.15% at 73,903.91 level while the Nifty 50 closed at 22,453.30 level, down 8.70 points or 0.04%.
According to market experts, the benchmark indices took a breather, ending the Tuesday's session flat. The bulls were favoured by the market's breadth, which was the positive takeaway. Nifty Consumer Durables (+1.86%), Nifty Media (+1.85%), and Nifty Metal (+1.50%) are the sectoral indices that ended the day with strong gains. The Nifty SmallCap index increased by 1.22%, and the MidCap 50 gained 1.09%, indicating that broader markets did better.
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Nifty 50 Outlook by Sagar Doshi, Senior Vice President- Research, Nuvama Professional Clients Group
The Nifty 50 has started this new fiscal year on a strong note, with the index hitting fresh all-time highs in its maiden session yesterday. The index has broken out of its consolidating range of 21,700 to 22,250 and is now moving towards a new range at an all-time high, with 22,250 now acting as support for the upward move from hereon, said Sagar Doshi, Senior Vice President-Research, Nuvama Professional Clients Group.
If we analyse data for the past two decades, the Nifty 50 has made fresh all-time highs in four instances in the commencing week of a new fiscal—the first week of April. Following this, it has given positive quarterly returns in three instances, averaging +8.47%, while one instance had a negative return of the same amount, explained Doshi.
Adding to this, analysing the seasonality trends in the Nifty 50's April calendar month has shown an average return of 2.1% over the past 22 years. For now, charts are indicating potential scaling towards 22,750 to 22,850 on the upside, with a buy-on-dip setup on daily charts, added Sagar.
Bank Nifty Outlook
Bank Nifty is likely to maintain its consolidation ahead of the RBI Policy outcome scheduled later this week. As the index has completed its previous target at 47,450, it is now headed towards its resistance zone at 47,850 ahead of the policy outcome. A significant potential cup and handle formation breakout stands above 47,900 (closing basis) on the index, which, if it plays out, could trigger another 1,500 to 2,000 points upside rally for Bank Nifty.
Top Stock Recommendations by Sagar Doshi
On top stock recommendations for Wednesday, Sagar Doshi has recommended three stocks:
HDFC Bank Ltd (BUY): LCP: ₹1,479.55; Stop Loss: ₹1,428.00; Target Price: ₹1,585.00
According to Sagar, HDFC Bank has completed its base formation as prices close on a fresh 2-month high. Momentum indicators are also in the bullish zone, indicating an upswing to continue.
UPL Ltd (BUY): LCP: ₹476.00; Stop Loss: ₹459.00; Target Price: ₹510.00.
Doshi stated that UPL has been in a sharp downtrend since Dec’22 and prices have seen an erosion of ~30%. A positive divergence on the daily chart indicates selling pressure is near exhaustion. A close above the trend line, which has been active since Jan’24 also indicates the start of a fresh upswing.
Indian Oil Corporation Ltd (IOC) (BUY): LCP: ₹174.10; Stop Loss: ₹168.00; Target Price: ₹187.00
According to Doshi, IOC saw a mammoth rally from Dec’23 as prices ran up from levels of 100 to 180. Since the start of Feb’24, stock has witnessed a time and price correction. Recently, prices have not only given a swing breakout but have also been able to breach the trend line, which has been active since the recent high. Strong volume supported by a swing breakout indicates the presence of strong hands.
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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