Stock market recap: The Indian equity benchmarks snapped their three-day winning streak on Tuesday, weighed down by escalating West Asia conflicts and a sharp 4% surge in Brent crude to $87 per barrel.
Reflecting the weak global risk appetite, Nifty 50 shed 0.66% to close at 24,052.05, while BSE Sensex dropped 0.72% to finish at 77,054.94. Compounding the geopolitical strain, domestic macroeconomic concerns intensified as India's June CPI inflation accelerated to 4.38% (surpassing the RBI's 4% midpoint target) alongside a widening trade deficit of $30.43B.
On the sectoral front, broad-based profit booking dragged Nifty PSU Bank, Auto, and Financial Services down by up to 2%, with laggards like HCL Tech and Shriram Finance leading the index decline. Market breadth was decisively bearish, recording 1,022 advances against 2,278 declines across the broader market.
Two stock recommendations by MarketSmith India:
Buy: Orchid Pharma Limited (current price: ₹1,055)
- Why it’s recommended: Strong focus on antibiotics APIs, growing formulations business, export market opportunities, USFDA-approved manufacturing facilities, backing from experienced promoter group, capacity utilization improvement potential, product pipeline expansion, benefit from China+1 sourcing trend, increasing domestic pharma demand, and turnaround in financial performance.
- Key metrics: P/E: 185.20, 52-week high: ₹1,106.95, volume: ₹83.22 crore
- Technical analysis: Trendline Breakout
- Risk factors: High dependence on the antibiotic segment, USFDA compliance risks, intense pricing pressure, customer concentration risk, raw material cost volatility, export market uncertainties, currency fluctuation risk, high competition in generics, execution risk in new launches, and earnings volatility during turnaround phase.
- Buy: ₹1,044–1,060
- Target price: ₹1,200 in two to three months
- Stop loss: ₹990
Buy: Multi Commodity Exchange of India Limited (current price: ₹2,891)
- Why it’s recommended: India's leading commodity exchange, strong market leadership, asset-light business model, high operating margins, growth in commodity trading volumes, new product launches support growth, rising participation from retail investors, technology platform improvements, strong cash generation, and favorable long-term commodity market outlook.
- Key metrics: P/E: NA, 52-week high: ₹3,480.00, volume: ₹1,055.51 crore
- Technical analysis: Trendline Breakout
- Risk factors: Dependence on trading volumes, regulatory policy changes, competition from new exchanges, technology and system outage risks, cybersecurity threats, market volatility affecting participation, product approval delays, high reliance on transaction fees, slower adoption of new products, and valuation premium risk.
- Buy at: ₹2,862–2,905
- Target price: ₹3,290 in two to three months
- Stop loss: ₹2,700
Nifty 50 performance
Indian equity markets ended lower, with selling pressure persisting through the session amid weak global sentiment and rising geopolitical concerns. Nifty 50 declined 158.95 points (-0.66%) to close at 24,052.05, after trading in a range of 24,023.70–24,157.10, while Sensex lost around 561 points.
Sectoral performance was largely negative. Nifty Realty (-1.97%), PSU Bank (-1.80%), Auto (-1.61%), Financial Services (-1.08%), and IT (-1.00%) lead the declines. On the other hand, Pharma (+1.03%), Healthcare (+0.89%), and Metal (+0.61%) outperformed. Market breadth remained decisively weak, with 1,022 stocks advancing, 2,278 declining, and 110 remaining unchanged, reflecting broad-based selling across the broader market. Bharti Airtel, Sun Pharma, TCS, Tata Steel, and Adani Ports were notable gainers, while HCL Tech, Bajaj Finserv, SBI, IndiGo, and Mahindra & Mahindra were among the key losers.
Nifty 50 ended the session lower, forming a small bearish candle after failing to sustain the recent recovery, indicating profit booking at higher levels. The 14-day RSI has eased to around 52, slipping below its signal line after recently moving into bullish territory. This indicates that positive momentum has moderated, though the oscillator remains above the neutral 50 mark, implying that the broader trend has not turned outright bearish. The MACD remains in positive territory with the MACD line above the signal line, reflecting that the medium-term trend is still constructive. However, the histogram has narrowed considerably, highlighting waning bullish momentum and suggesting that the recent upward impulse is losing strength.
The index is currently trading near a crucial support zone at 23,800, which will be closely monitored in the coming sessions. A decisive breakdown below this level could intensify selling pressure and open the door for a decline toward 23,600–23,500. On the upside, 24,300 remains the immediate and critical resistance level.
A sustained move above this hurdle would be required to improve near-term sentiment and signal a recovery in market momentum. Until either of these levels is decisively breached, the index is likely to remain range-bound with a cautious bias, as investors await fresh triggers for the next directional move.
How did Nifty Bank perform on Tuesday?
Nifty Bank opened on a negative note at 57,832.55 and remained under pressure throughout the session as selling emerged from higher levels. The index touched an intraday high of 57,840.05, slipped to a low of 57,286.90, and finally settled at 57,462.30, down 669.15 points (-1.15%). The sharp decline indicates that profit booking intensified after the index failed to sustain near its recent highs. The session also resulted in a bearish candlestick, reflecting weakening short-term sentiment and increasing supply at higher levels.
Despite the weakness, the index managed to hold above its 200-DMA on a closing basis, suggesting that long-term market structure remains intact. The recent consolidation following a strong recovery indicates that the index is entering a decision zone where sustained buying will be required to revive upward momentum.
From a technical perspective, the RSI is placed at 52.83, slipping below its signal line, indicating that bullish momentum has moderated while remaining in positive territory. The MACD continues to display a bearish crossover, with the MACD line trading below the signal line and the histogram remaining in negative territory, reflecting weakening near-term momentum. The index has also slipped below its 10-DMA and 21-DMA, highlighting a loss of short-term strength, although it continues to trade above the 50-,100-DMA, and 200-DMA, keeping the broader trend constructive. Momentum indicators therefore suggest a cautious approach until stronger buying interest re-emerges.
Technically, immediate support is placed around 57,300–57,250, followed by 57,000, while stronger support is seen near 56,850–56,100, where the 50 -MA and 100-DMA could provide stability. On the upside, immediate resistance is placed at the 10-DMA near 57,800, followed by the recent swing high around 58,000–58,200.
A decisive move above these levels could revive bullish momentum and open the door for a fresh rally. However, continued profit booking amid mixed global cues, uncertainty around interest-rate expectations, and cautious investor sentiment may keep the index range-bound in the near term. Holding above the 200-DMA remains critical for maintaining the broader positive outlook.
MarketSmith India is a stock research platform and advisory service focused on the Indian stock market. It offers tools and resources to help investors make informed decisions based on the CAN SLIM methodology, founded by legendary investor William J. O'Neil. You can access a 10-day free trial by registering on its website.
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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 making any investment decisions.