BEL to Glenmark - Jay Thakkar suggests 3 stocks to buy or sell for short-term in F&O segment

Stock market today: The domestic benchmark indices opened lower on Wednesday, 9 September as a fresh escalation in the Middle East conflict pushed Brent crude towards the $100-per-barrel mark, raising concerns for India, the world’s third-largest crude oil importer.

The Nifty 50 fell 0.56% to 23,511.40, while the BSE Sensex declined 0.60% to 75,122.70 as of 9:20 IST.

Ten of the 16 major sectoral indices traded in negative territory. The IT index fell 3.5%, led by a sharp decline in Coforge, which tumbled 7% after Chairman Om Prakash Bhatt resigned following concerns raised by an internal audit over the company’s board evaluation process.

Broader market indices also came under pressure, with the small-cap and mid-cap indices declining 0.3% and 0.5%, respectively.

The domestic equity indices ended lower in the previous session, with the benchmark Nifty 50 closing below 23,700 level.

The Sensex dropped 555.23 points, or 0.73%, to close at 75,577.58 , while the Nifty 50 settled 144.05 points, or 0.61%, lower at 23,635.10.

Market Outlook by Jay Thakkar, Vice President & Head of Derivatives and Quant Research, ICICI Securities

Nifty 50

Nifty 50 has been forming lower highs and lower lows, and with that, the FII net short positions in the Index have been increasing as well, now standing at 2.5 lakh contracts as of Monday's close, indicating an overall negative bias. Since the 24,000 level, which had the highest put base for the September series, was broken, weakness has increased in the Nifty 50. Now, on the upside, the 24,000 level is not taken off the short-term trend, which is sideways to negative. Now, on an immediate basis, 23,500 is supported. Until that is held, there is a chance of a bounce, and if the 23,500 level is broken, it is expected to slide quickly to 23,000. Rising crude oil prices and bond yields are adding pressure on the Nifty 50 in the near term.

Stocks To Buy in the near-term - Jay Thakkar

Jay Thakkar of ICICI Securities recommends Bharat Electronics Ltd (BEL) futures, Glenmark Pharmaceuticals futures, and Max Healthcare Institute futures.

Buy BEL futures in the range of ₹410-415; stop loss ₹395; Targets ₹430-445

BEL was consolidating within a range of ₹415-405, and has now broken out of it. The stock has seen short covering in recent times, and with this breakout, a further move higher is expected. As per the options data, there have been additions at the 410 strike, which is immediate support, and 415 has the highest call base, above which more short covering is expected. The max pain is at ₹410, and the stock is trading just above it.

Buy Glenmark futures in the range of ₹2,480-2,490; stop loss below ₹2,440 Targets at ₹2,560-2,600

Glenmark has been forming higher lows and higher highs, and with that, it has witnessed a long build-up as well, indicating a clear uptrend. The options data suggest that the call unwinding is likely in the stock, which will help it to inch higher. The 2400 strike call writers have yet to cover their positions, and the max pain is at 2400; hence, 2400 is now support, and the stock is trading well above it.

Buy Max Health futures in the range of ₹995-1,000; stop loss below ₹970; Targets ₹1,040-1,065

Max Health has fallen quite a lot recently and has seen short additions; however, prior to this, it had seen short covering, which led to a decent rally in the stock. Now, the stock has fallen to its previous levels, and this time the shorts are less than the previous fall, indicating that the weak hands are selling right now. Overall, the Nifty Healthcare Index has been in an uptrend, hence a short-term bounce from an oversold region can't be ruled out.

Disclaimer: The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions.