Stock market recap: Indian equity markets showed resilience on 14 May, with the Nifty 50 rising 1.18% to close at 23,689.60 despite early volatility. Market breadth remained positive, with 1,725 gainers outpacing 1,540 decliners.
Sectoral performance was largely bullish. Nifty Pharma climbed 2.74%, while Nifty Healthcare gained 2.56%, reflecting strong defensive buying interest. Metal and PSU bank stocks also advanced more than 1.3%. In contrast, Nifty IT emerged as the key laggard, falling 1.99% amid persistent global technology headwinds.
Investor sentiment was shaped by the release of wholesale price index (WPI) data and shifting geopolitical dynamics in energy markets. The session also saw a rotation into commodity and healthcare stocks as institutional investors repositioned portfolios following recent policy cues.
The broad-based recovery points to cautious optimism in the market, with investors closely tracking sectoral earnings and macroeconomic stability for further direction.
Two stock recommendations by MarketSmith India for 15 May:
Buy: Engineers India Limited (current price: ₹254)
- Why it’s recommended: Strong PSU backing, debt-free or low-debt balance sheet, strong order book visibility, beneficiary of refinery and energy capex, growing focus on green hydrogen projects, stable cash flow generation, high expertise in EPC & consultancy, dividend-paying company, asset-light consultancy business mix, exposure to government infrastructure spending, strong client base in oil & gas sector, and potential gains from overseas projects
- Key metrics: P/E: 18.53, 52-week high: ₹267.00, volume: ₹251.16 crore
- Technical analysis: Consolidation base breakout
- Risk factors: Heavy dependence on government projects, slow execution risk in EPC projects, cyclical oil & gas sector exposure, margin pressure from rising costs, delays in order inflows, PSU-related operational inefficiencies, lower growth compared to private peers, high competition in EPC industry, dependence on crude oil investment cycle, working capital/payment delay risk, policy & regulatory uncertainties, and limited diversification outside energy sector
- Buy: ₹251–255
- Target price: ₹320 in two to three months
- Stop loss: ₹235
Buy: Alkyl Amines Chemicals Ltd (current price: ₹1,750)
- Why it’s recommended: Market leader in aliphatic amines, strong specialty chemical demand, high entry barriers in the amines business, strong export presence, healthy operating margins, consistent profit growth track record, capacity expansion opportunities, beneficiary of pharma & agrochemical growth, strong customer relationships, low debt and strong balance sheet, good return ratios (ROE/ROCE), and niche product portfolio
- Key metrics: P/E:46.50, 52-week high: ₹2,438.80, volume: ₹933.71 crore
- Technical analysis: Reclaimed 200-DMA on above average volume
- Risk factors: Dependence on raw material prices, volatile chemical industry cycles, environmental and regulatory risks, export demand slowdown risk, high competition from global players, currency fluctuation impact, capacity expansion execution risk, customer concentration risk, margin pressure during weak demand, dependence on pharma/agro sectors, rich valuation risk at high PE, and energy cost inflation impact.
- Buy at: ₹1,733–1,759
- Target price: ₹1,990 in two to three months
- Stop loss: ₹1,650
Nifty 50 performance on 14 May
Indian equity markets ended firmly higher on 14 May, with the Nifty 50 rising 277 points, or 1.18%, to close at 23,689.60 after sustained buying through the second half of the session. The Sensex also posted strong gains, supported by broad-based buying in financials, pharma, metals and healthcare stocks.
Market breadth remained positive, with 1,725 stocks advancing against 1,540 declines, while 105 shares remained unchanged, indicating improving risk appetite despite selective profit booking in technology stocks.
Among sectoral indices, Nifty Pharma rose 2.74%, Healthcare gained 2.56%, Metal advanced 2.04%, and Financial Services climbed 1.44%. Nifty IT, however, underperformed, falling nearly 2% amid weakness in global technology sentiment. Buying interest in private and PSU banks also lent support to benchmark indices.
Technically, the Nifty staged a strong rebound from lower levels and formed a bullish daily candle, signalling renewed buying interest after recent corrective pressure. Price action suggests the index is attempting to stabilise near the short-term moving average cluster, while the broader structure remains in a recovery phase following the sharp March-April decline.
Momentum indicators remain mixed but are showing signs of improvement. The relative strength index (RSI) has rebounded from lower levels and is hovering near the neutral 46 mark, suggesting easing bearish momentum and the possibility of further upside if buying sustains. However, the RSI remains below its signal average, indicating that confirmation of a stronger trend reversal is still awaited.
Meanwhile, the moving average convergence divergence (MACD) indicator remains in negative territory, with the signal line above the MACD line, suggesting the broader momentum structure has yet to turn decisively bullish. That said, the narrowing histogram points to weakening downside momentum and early signs of a potential positive crossover in the coming sessions.
According to O’Neil’s market direction methodology, the Indian equity market has been downgraded to “Uptrend Under Pressure” from “Confirmed Uptrend”.
Despite the rebound, the index continues to trade below the 23,800 mark and its 50-day moving average (DMA), indicating that the broader near-term trend remains cautious. The inability to decisively reclaim the 23,800-24,000 zone suggests investors are awaiting stronger follow-through buying before confirming a sustained recovery.
On the downside, the 23,250-23,150 range is expected to act as an important support zone where buying interest could remain active. A decisive breach below this range may weaken the current recovery structure and increase the risk of extended profit booking, potentially dragging the index towards the 22,700 level in the coming sessions.
Nifty Bank's performance
Nifty Bank opened on a positive note at 53,639.50 and witnessed a volatile trading session. The index touched an intraday high of 54,393.75, while profit booking at higher levels dragged it to a low of 53,191.60 during the session. However, selective buying in heavyweight banking counters helped the index recover from lower levels and settle at 54,128.95, gaining 672.80 points or 1.26% on a closing basis.
The rebound from intraday lows indicates that traders are still willing to accumulate quality banking stocks despite broader market uncertainty. The candlestick formation reflects buying interest near lower levels, though the index continues to trade below crucial medium-term moving averages, keeping the broader trend cautious in the near term.
On the technical front, the RSI (14) is placed near 43.79 and remains below 50, indicating subdued momentum and a lack of strong bullish conviction. The RSI also remains below its signal average of 46.98, suggesting that recovery attempts are still fragile. Meanwhile, the MACD indicator remains in negative territory, with the MACD line positioned below the signal line, reflecting persistent bearish undertones in the intermediate trend. However, the narrowing histogram suggests that downside momentum is gradually weakening. If momentum indicators stabilize further, the index may attempt a short-term consolidation rebound. Sustained strength above near-term averages would be required to confirm any meaningful trend reversal.
Technically, immediate support for the index is placed around 53,200–53,000, which acted as a strong intraday demand area. A decisive breach below this region could accelerate weakness toward 52,500. On the upside, immediate resistance is visible near 54,400, followed by stronger hurdles around 55,250–55,550, where the 21- and 50-DMA are positioned. The index is currently trading below its major moving averages, indicating that the broader structure remains weak despite intermittent pullbacks. Going forward, market participants are expected to closely monitor global interest-rate cues, institutional flows, and banking earnings momentum. Unless the index sustains above 55,500, rallies are likely to face selling pressure, while range-bound consolidation with a negative bias may continue in the coming sessions.
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.