Indian equities closed lower on Thursday, with the Nifty 50 slipping 116.90 points, or 0.48%, to settle at 24,090.85, while the Sensex fell 539.35 points, or 0.70%, to 76,933.59. The market opened firmer, tracking overnight strength on Wall Street after strong Nvidia earnings lifted global risk appetite.
However, gains reversed as easing crude prices, aided by Iran-Oman talks on reopening the Strait of Hormuz, failed to offset domestic pressure points. HDFC Bank was among the session's biggest drags after a US lawsuit weighed on the stock, pulling down banking and financial services. Metals led sectoral losses, down more than 1%, followed by FMCG, oil and gas, and auto.
At the same time, capital goods, Healthcare, and consumer durables bucked the trend with modest gains. Market breadth stayed weak throughout the session, with 1,341 stocks advancing, 2,160 stocks declining, and 118 remaining unchanged, underscoring a broad-based pullback despite the relatively modest index-level decline. Persistent foreign-fund outflows and firm gold prices amid import-duty uncertainty added to the cautious undertone. With the index holding below 24,200, near-term sentiment stays fragile, and investors will track global cues and domestic flows for the next directional trigger.
Two stock recommendations by MarketSmith India:
Kalyan Jewellers India Ltd (current price: ₹631)
Why it’s recommended: Franchise-Led Expansion: Accelerated deployment of the capital-light Franchisee-Owned Company-Operated (FOCO) model scales showroom networks rapidly while boosting Return on Capital Employed (ROCE). Organised Retail Shift: Strong structural market share gains driven by regional consumer trust, hyper-local marketing strategies, and the ongoing formalization of the Indian jewellery sector.
Key metrics: P/E: 43.10 | 52-week high: ₹648.95 | Volume: ₹915.31 crore
Technical analysis: Trendline Breakout
Risk factors: Gold Price Volatility: Sudden fluctuations in underlying gold prices cause immediate revenue volatility and compress inventory margins. Elevated Valuation Overhang: A high price-to-earnings multiple leaves little room for operational error, making the stock prone to steep corrections following any quarterly earnings disappointment.
Buy: ₹625-634
Target price: ₹730 in two to three months
Stop loss: ₹599
Buy: Bharat Heavy Electricals Ltd (current price: ₹434)
Why it’s recommended: Massive Order Book: A historic backlog of approximately ₹2.4trillion provides robust multi-year revenue visibility and capitalizes on India's power and railway capex cycle. Thermal Power Resurgence: Dominant position in domestic power equipment manufacturing secures massive fresh orders from major state and private infrastructure utility firms.
Key metrics: P/E: 59.48 | 52-week high: ₹446.50 | Volume: ₹860.90 crore
Technical analysis: Bounce from its 50-DMA
Risk factors: Working Capital Stress: Rising inventory levels and slow-moving receivable turnarounds tie up critical operating cash flow, limiting financial flexibility. Execution and Delay Risks: Complex, long-gestation infrastructure projects face margin compression if hit by raw material price inflation, prolonged vendor negotiations, or delayed commissioning timelines.
Buy at: ₹430-436
Target price: ₹495 in two to three months
Stop loss: ₹410
Nifty 50: How the benchmark index performed on 27 August
Indian equities ended Thursday’s session under pressure, with the Nifty 50 closing at 24,090.85, down 116.90 points or 0.48%, after opening at 24,277.60 and touching an intraday high of 24,297.45 before persistent selling dragged the index to the day’s low at the close. Market breadth remained distinctly weak, with 1,341 stocks advancing, 2,160 stocks declining, and 118 remaining unchanged, translating into an advance-decline ratio of about 0.62, indicating broader selling beyond the benchmark.
On the sectoral front, PSU Banks (-0.94%), Media (-0.89%), Metals (-0.86%), and Oil & Gas (-0.80%) were among the key laggards. At the same time, Defensive and Consumption pockets provided support: Pharma (+0.84%), Healthcare (+0.73%), and Consumer Durables (+0.72%). Private banks were broadly resilient, ending marginally higher. HDFC Bank remained under pressure during the session, while select Pharma and Healthcare names attracted buying interest.
The Nifty 50 closed at 24,090.85, with the latest price action reflecting a weakening near-term setup. The index has breached its 50-day moving average (DMA), indicating a loss of short-term momentum. However, it continues to hold above the rising trendline drawn from the April lows, which remains technically significant as the index has bounced from this upward-sloping trendline on multiple occasions during the ongoing recovery.
A decisive break below this trendline would weaken the broader recovery structure, while continued adherence could provide a base for renewed upside momentum. Momentum indicators remain cautious: the RSI has slipped to around 43.5 and is trading below its signal average near 50, highlighting fading buying strength without yet entering oversold territory. Meanwhile, the MACD has turned negative, with the MACD line below the signal line and the histogram in negative territory, reinforcing the deterioration in short-term momentum.
The Nifty 50 has breached its 50-day moving average (DMA), indicating some deterioration in near-term momentum. Although the index continues to hold above its upward-sloping trendline, keeping the broader recovery structure intact for now. On the downside, a decisive break below 24,100-24,000 would weaken the prevailing technical setup and could extend the corrective move toward 23,900-23,800. On the other hand, the 21-DMA near 24,400 is likely to act as the immediate hurdle. A sustained close above this level would signal improving short-term momentum. This could pave the way for a broader recovery toward 24,700, where the 200-DMA is currently positioned.
How did the Nifty Bank perform yesterday?
The Nifty Bank opened on a positive note, but the early strength was short-lived as profit booking emerged near the intraday high. The index opened at 57,985.00, touched a high of 58,012.40, declined to a low of 57,509.95, and closed at the day’s low of 57,509.95, down 273.80 points or 0.47%.
The session formed a strong bearish candle with a negligible upper wick and no lower wick, indicating sustained selling pressure. The index slipped below its 21-SMA (57,612.12) and 50-SMA (57,629.08), while finishing marginally above its 200-SMA (57,452.94). This clustering of key averages marks an important inflection zone, where follow-through selling or renewed buying could determine the index’s next directional move.
RSI stood at 50.00, slightly below its signal average of 50.84, indicating neutral momentum with a mild bearish bias. The indicator has flattened near the midpoint, suggesting neither strong accumulation nor oversold conditions, while no meaningful price–RSI divergence is visible. MACD remained above the zero line at 46.94 but stayed below its signal line at 60.92. The negative histogram of 13.98 confirms a bearish crossover and weakening upside momentum.
However, as MACD remains positive and the index traded near its 200-SMA, the setup presently indicates consolidation rather than an established downtrend. Momentum must expand beyond the recent range to provide stronger directional confirmation.
Immediate support lies at 57,450-57,500, comprising the day’s low and 200-SMA. A sustained break below this zone could expose 57,000, followed by 56,350 near the 100-SMA. On the upside, 57,610-57,650, where the 21- and 50-SMAs converge, is the first resistance. Above it, 58,000-58,300 remains the key supply area.
The Nifty Bank may remain range-bound with a mildly negative bias unless it swiftly reclaims 57,650. RBI’s unchanged 5.25% repo rate, neutral stance, resilient credit conditions, and 6.7% FY27 growth projection support the medium-term outlook. However, inflation risks, volatile oil prices, and global uncertainty could restrain near-term sentiment. A decisive close above 58,300 would strengthen the breakout setup.
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.
Trade name: William O’Neil India Pvt. Ltd.
Sebi Registration No.: INH000015543
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.