Day trading guide for today: Six buy or sell stocks for Monday - May 22

According to analysts, today's equities markets could experience volatility, which would mostly be influenced by domestic quarterly earnings, global trends, and foreign fund trading activity.

Investors shall continue to pay close attention to the US debt ceiling talks on a global scale. With a deadline of June 1 to raise the country's borrowing ceiling, now set at USD 31 trillion, in order to continue paying the nation's debts, US President Joe Biden's administration is working to reach an agreement with Republicans.

The final Q4 numbers are expected to be released this week, according to Deepak Jasani, Head of Retail Research at HDFC Securities. Individual stock prices may be impacted, but foreign portfolio investment (FPI) flows and developments in the US debt crisis situation will determine the overall sentiment.

Equity markets took a breather last week. The Nifty fell 111.4 points or 0.60%, while the BSE Sensex dropped 298.22 points or 0.48%. On Friday, the Nifty 50 rose by 73.45 points, or 0.41%, to close at 18,203.40, and the 30-share BSE Sensex increased 297.94 points or 0.48% to close at 61,729.68.

The IT, finance, and auto sectors also saw significant rises on Friday. Nifty Realty climbed by 0.87%, Nifty Auto rose by 0.70%, Nifty IT increased by 1.47%, Nifty Private Bank gained by 0.45%, Nifty Metal increased by 0.29%, and Nifty PSU Bank increased by 0.31%.

Foreign institutional investors (FIIs) sold shares of Indian companies worth ₹113.46 crore on Friday after buying for sixteen days in a row. On the other side, domestic institutional investors (DIIs) purchased shares worth ₹1,071.35 crore after being net sellers for the third straight session.

Friday trade: FIIs sell ₹113.46 crore in Indian market on May 19, DIIs invest ₹1,071.35 crore; check details

According to NSDL data, FPIs purchased assets on the Indian stock exchanges in April for a total of ₹11,631 crore. They made investments in the Indian stock markets in March totaling roughly ₹7,936 crore.

They have reportedly invested over ₹30,000 crore on equities assets so far in May. The recent US banking crisis that followed Silicon Valley Bank's failure in early March and India's reasonably bright economic outlook appeared to have revived interest in domestic stocks.

During the week, well-known companies like BPCL, Ashok Leyland, Hindalco, ONGC, Grasim, and Zed will release their Q4 earnings results.

Analysts advise traders to concentrate just on picking stocks from the recommended industries, such as banking, financials, FMCG, and auto.

According to Joseph Thomas, Head of Research, Emkay Wealth Management, over the near term the markets may be expected to be volatile, led by very stock-specific movements as the earnings season goes underway in full swing. 

Here are key stocks to buy and sell in the trading session of Monday:

Sumeet Bagadia, Executive Director at Choice Broking:

- Buy ICICI Bank with a stop loss of ₹940 for a target price of ₹975-980.

- Buy Motherson Sumi with a stop loss of ₹77 for a target price of ₹86-88.

Ganesh Dongre, Senior Manager - Technical Research at Anand Rathi:

- Buy Reliance Industries at ₹2,442 with a stop loss of ₹2,415 for a target price of ₹2,475.

- Buy Uflex at ₹440 with a stop loss of ₹425 for a target price of ₹465.

- Nifty Spot index to see support at 18000/18050, while resistance seen at 18500/18550

- Bank Nifty spot index to see support at 42500/42600 and resistance – 44300/44000

Rajesh Bhosale - Equity Technical and Derivative Analyst, Angel One

- Buy Bharti Airtel at ₹805 with a stop loss of ₹789 for a target price of ₹835

- Buy Mphasis at ₹1,906 with a stop loss of ₹1,859 for a target price of ₹2,000

- Nifty Spot index to see support at 18100/18050, while resistance seen at 18330/18400

- Bank Nifty spot index to see support at 43700/43500 and resistance – 44150/44350