Day trading guide for today: Six buy or sell stocks on Tuesday - October 10

Stock market news: Domestic equity benchmark indices ended its two day winning streak on Monday as investors sold off financial, banking, and energy sectors amid mounting Middle East tensions and rising crude oil prices overseas

Following an unforeseen attack on Saturday by Hamas fighters from Gaza that left about 1,000 Palestinians dead and several others injured, Israel declared war on the group.

The 30-share BSE Sensex dropped 483.24 points, or 0.73%, to end the session at 65,512.39.The Nifty 50 fell 141.15 points, or 0.72%, to finish at 19,512.35.

While 43 out of the 50 equities in the Nifty 50 closed in the red, only three Sensex stocks ended in the green. Barring Pharma Index, all the other sectoral indices ended in red, with maximum pain seen in PSU Banks Index. even the Indian Volatility Index (India VIX) shot-up by 10.68% to 11.40 level.

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On Monday, there was a significant increase in the price of crude oil as fears over supplies increased as a result of the continuous military confrontations between Israel and the Palestinian Islamist organisation Hamas. In Monday's trading, Brent Crude prices increased by nearly $3 per barrel, closing close to the $87 per barrel level.

Also Read: Market close: Nifty 50, Sensex snap 2-day winning run; investors lose about ₹4 lakh crore in a day

According to Prashanth Tapse, Research Analyst, Senior Vice President of Research at Mehta Equities, Nifty 50's recovery hopes were shattered in Monday's trade as death toll in Israel crossed over 1,100 owing to the current war situation against the Hamas militants. The tremors from this war are seen all across the globe where equity markets are seen tumbling. On the contrary, crude oil prices, precious metals are seen surging as investors shifting towards safe-haven assets.

Also Read: Global markets today: Oil prices jump, investors shun stocks

"If Monday's trading action is any indication, then the markets likely to remain subdued during the week. The key make-or-break support to watch out for now at 19221 mark on Nifty. We suspect Bank Nifty to underperform the benchmark Nifty during the week with downside risk seen below psychological 43000 mark.

All eyes on TCS Q2 results for FY24 to be wired on October 11. Also, CPI Inflation numbers for September both domestically as well in the US will be keenly watched during the week starting from October 11th," added Tapse.

Also Read: Oil climbs on supply concerns after Israel-Hamas clashes

What to watch for today?

Stock Specific movement to watchout for:

Maruti Suzuki: Maruti Suzuki India Ltd on Monday said it is looking to invest as much as ₹1.25 trillion by 2030-31 to develop 10-11 new models, including six electric vehicles (EVs), and double its annual production to 4 million units.

Adani Group stocks: Adani Group has released a media statement condemning the ‘Malicious Campaign’ by UK-based newspaper Financial Times, claiming that the media outlet has been rehashing old and baseless allegations to hamper the global reputation of the conglomerate.

Tata Steel: In the wake of alleviating risk from UK Operations, the Issuer Default Rating (IDR) of Tata Steel was upgraded to ‘BBB-’ from ‘BB+’ by Fitch Ratings on Monday.

Hindustan Zinc: Vedanta Ltd on Monday said the tax authorities have imposed a penalty of ₹1.81 crore on its subsidiary Hindustan Zinc. The order was received on Sunday, October 8, and Vedanta Ltd informed the exchanges. "

Glenmark Lifescience: Glenmark Life Science, on Monday, announced an interim dividend of ₹22.50 per equity share of ₹2 each for its investors for FY24.

Also Read: Stocks to Watch: Maruti, Adani stocks, Tata Steel, Hindustan Zinc, Star Health

Trade Ideas for today

Sumeet Bagadia, Executive Director at Choice Broking recommends buying Tata Consumer Products Ltd in cash at ₹880.65 with a stop-loss of ₹860 for a target price of ₹910.

According to Bagadia, Tata Consumer is currently displaying several positive technical indicators in its trading pattern. The Relative Strength Index (RSI) at 55 suggests that the stock is in a balanced state, neither overbought nor oversold, indicating a stable trend.

Furthermore, the stock has crossed above its 20-day Exponential Moving Average (EMA) and closed above it, which is often considered a bullish sign. It's also trading above other key moving averages, which further reinforces the bullish sentiment.

The Bollinger Bands have recently expanded after a period of squeezing, and the price is trading above the center line of the Bollinger Bands. This suggests increased volatility and potential upward momentum.

Also Read: FIIs sell Indian stocks worth ₹6,049.97 crore, DIIs buy worth ₹8,216.60 crore

There's a minor resistance level at ₹895, and if the stock manages to break above it, it could potentially reach 910 levels and beyond.

With a medium-term target price of ₹910, he advised purchasing Tata Consumer at the current market price (CMP) of ₹880.65. If the price closes below ₹860, his analysis will be regarded as being invalid.

Further, Sumeet also suggests buying LIC Housing Finance Ltd in cash at ₹466.10 with a stop loss of ₹456 for a target price of ₹485.

LIC Housing Finance Ltd is currently trading at ₹466.10. On the daily chart, the price appears to be finding support at the 20-day EMA and has formed a dragonfly doji candlestick pattern, signaling potential bullish momentum. Should the price close above ₹468, it could potentially target levels of ₹478 and ₹490 as immediate resistance levels. Conversely, ₹456 serves as a critical support level.

Also Read: F&O Ban List: Delta Corp, 5 others placed under F&O ban on NSE for Oct 10

Moreover, LIC Housing Finance is currently trading above key EMA, including the 20-day, 50-day, 100-day, and 200-day EMAs, reinforcing the bullish sentiment and suggesting the possibility of further upward price movement.

The RSI is presently at 58.43 and trending upwards, indicating increasing buying momentum. Additionally, the Stochastic Relative Strength Index (Stoch RSI) has recently experienced a positive crossover from the oversold region. This combination of technical indicators suggests that LIC Housing Finance may have the potential to reach a target price of ₹485 in the near term.

To effectively manage risk, it is advisable to implement a stop-loss at ₹456 to safeguard your investment in the event of an unexpected market reversal. In summary, considering the technical analysis and prevailing market conditions, LIC Housing Finance appears to offer an appealing buying opportunity for those targeting a ₹485 price objective, provided they have prudent risk management measures in place.

Mitesh Karwa, Research Analyst, Bonanza Portfolio Ltd recommends buying Oil India Ltd in the range of ₹309 to ₹311 with a stop loss of ₹299 for a target price of ₹330.

According to Karwa, Oil India is seen to be breaking out of previous swing high and closing in green which is why a buy recommendation is initiated for targets upto ₹330. One can initiate buy on dip in the range of 309-311 with stoploss below 299 on daily closing basis, explained Karwa.

Mitesh Karwa also recommends buying Avenue Supermarts Ltd (DMart) in the range of ₹3,790 to ₹3,799 with a stop loss of ₹3,768 for a target price of ₹3,854. Karwa explained that DMart stock is seen to be retesting a trendline breakout and is trading near an important support zone on the daily timeframe, which is buying is recommended for targets upto ₹3,854. One can initiate a buy trade in between the range of ₹3,790 to ₹3,799 with stoploss of ₹3,768 on daily closing basis.

On the Radar: Here are key stocks to buy in the trading session of Tuesday

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

- Buy Sundram Fasteners Ltd at ₹1,241 with a stop-loss of ₹1,220 for a target price of ₹1,299.

According to the analyst, in the short-term trend, the stock has a bullish reversal pattern, technically retrenchment could be possible till ₹1,290 so, holding the support level of 1220 this stock can bounce toward the ₹1,290 level in the short term, so the trader can go long with a stop loss of ₹1,210 for the target price of ₹1,290.

- Buy DLF Ltd at ₹538 with a stop-loss at ₹525 for a target price of ₹569.

On the short-term chart, the stock has shown a bullish reversal pattern, so holding the support level of ₹525. This stock can bounce toward the ₹560 level in the short term, so the trader can go long with a stop loss of ₹525 for the target price of ₹560, believes the analyst.

- Nifty Spot index to see support at 19600/19650, while resistance seen at 20200/20250.

Chinmay Barve, Head of Technical & Derivatives Research at Profitmart Securities

Nifty Call Option data - Options Expiry October 12

As per data shown by nseindia.com at 3.30 pm on 09 October 2023, major total Call open interest was seen at 19600, 19700 and 19800 strikes with total open interest of 143790, 129946 and 157665 contracts respectively. Major Call open interest addition was seen at 19600 and 19800 strikes which added 74416 and 78693 contracts respectively, said Barve in a report.

Nifty Put Option data - Options Expiry October 12

As per data shown by nseindia.com at 3.30 pm on 09 October 2023, major total Put open interest was seen at 19500 and 19400 strikes with total open interest of 165181 and 96792 contracts respectively. Major Put open interest addition was seen at 19500 and 19200 strikes which added 23515 and 21480 contracts respectively, said Barve in a report.

Bank Nifty Call Option Data - Options Expiry October 11

As per data shown by nseindia.com at 3.30 pm on 09 October 2023, major total Call open interest was seen at 44000 and 44200 strikes with total open interest of 231711 and 128009 contracts respectively. Major Call open interest addition was seen at 44000 and 44100 strikes which added 177247 and 77500 contracts in open interest respectively, said Chinmay in a report.

Bank Nifty Put Option Data - Options Expiry October 11

As per data shown by nseindia.com at 3.30 pm on 09 October 2023, major total Put open interest was seen at 43900, 43800 and 43500 strikes with total open interest of 129268, 133689 and 122549 contracts respectively. Major Put open interest addition was seen at 43900 strike which added 49521 contracts, said Chinmay in a report.

Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before taking any investment decisions.