Stock market recap: The Indian stock market ended lower on Tuesday, 21 July, with the benchmarks, the Sensex and the Nifty 50, extending losses for the second consecutive session as escalating tensions West Asia and rising crude oil prices continue to weigh on market sentiment.
The Sensex ended 238 points, or 0.31%, lower at 77,470.11, while the Nifty 50 settled at 24,187.70, falling 51 points, or 0.21%. The mid and small-cap segments continued their outperformance on expectations of healthy Q1 earnings. The Nifty Midcap 100 index rose by 0.30%, while the Smallcap 100 index climbed 0.53%.
Two stock recommendations by MarketSmith India:
Buy: City Union Bank Ltd (current price: ₹230)
- Why it’s recommended: Strong retail and SME franchise, healthy asset quality, consistent profitability track record, strong CASA base, conservative lending approach, healthy capital adequacy, strong presence in South India, growing digital banking capabilities, stable deposit growth, focus on secured lending, healthy return ratios, experienced management team, strong SME customer base, attractive valuation potential, and long-term credit growth opportunity.
- Key metrics: P/E: 16.81, 52-week high: ₹243.08, volume: ₹100.94 crore
- Technical analysis: Trendline Breakout
- Risk factors: Geographic concentration risk, intense competition from larger banks, slower loan growth risk, interest rate cycle impact, margin pressure from deposit costs, credit cost volatility, CASA growth challenges, regulatory compliance risks, economic slowdown affecting SME borrowers, rising competition for deposits, asset quality deterioration risk, technology and cybersecurity risks, limited pan-India presence, earnings growth moderation risk, and valuation re-rating may take time.
- Buy: ₹229–232
- Target price: ₹280 in two to three months
- Stop loss: ₹215
State Bank of India (current price: ₹1,044)
- Why it’s recommended: India's largest commercial bank, strong retail and corporate franchise, healthy asset quality improvement, strong CASA base, diversified loan portfolio, consistent profit growth, strong capital adequacy, extensive branch network, leadership in digital banking, beneficiary of rising credit demand, strong subsidiary ecosystem, healthy return ratios, government ownership support, attractive valuation versus peers, and long-term growth potential.
- Key metrics: P/E: 11.80, 52-week high: ₹1,234.70, volume: ₹1,106.51 crore
- Technical analysis: Trendline Breakout
- Risk factors: Large exposure to corporate lending, interest rate cycle impact, margin pressure from deposit costs, credit cost volatility, regulatory and compliance risks, slower loan growth risk, competition from private banks, asset quality deterioration risk, government ownership constraints, rising competition for deposits, economic slowdown affecting borrowers, technology and cybersecurity risks, PSU-related operational challenges, and earnings volatility during weak credit cycles.
- Buy at: ₹1,034–1,049
- Target price: ₹1,150 in two to three months
- Stop loss: ₹995
Nifty 50 performance on 21 July
Indian equities ended marginally lower on July 21st, 2026, with Nifty 50 closing at 24,187.70, down 50.80 points (-0.21%), after trading in a narrow range of 24,135.65–24,262.20 as investors remained cautious amid mixed global cues and the ongoing Q1 earnings season.
However, market breadth remained positive, with 1,812 stocks advancing, 1,505 declining, and 119 remaining unchanged, indicating continued buying interest in the broader market despite weakness in the frontline indices. On the sectoral front, Nifty Realty (+1.07%), Auto (+0.93%), Metal (+0.63%), Healthcare (+0.35%), and Pharma (+0.34%) outperformed.
On the other hand, PSU Bank (-0.88%), IT (-0.61%), Oil & Gas (-0.50%), Consumer Durables (-0.38%), and FMCG (-0.31%) ended in the red. Stock-specific action dominated the session as earnings expectations drove rotation across sectors.
Nifty 50 continues to trade in a consolidation phase while holding firmly above its 21-DMA, indicating that the short-term bullish structure remains intact despite the lack of strong directional momentum. The RSI is around 54, remaining above the neutral 50 mark, indicates healthy momentum without entering overbought territory. Meanwhile, the MACD remains in positive territory, although the histogram has flattened and the signal lines are moving closer together, indicating that bullish momentum has moderated but has not reversed.
The index continues to consolidate within 24,100–24,400, reflecting a phase of healthy consolidation after the recent recovery. A sustained move above the upper end of this range would reinforce the prevailing bullish bias and could open the door for a rally toward 24,500–24,600. On the downside, 24,000–23,800 remains a crucial demand area and will be closely watched for signs of buying interest. If the index holds above this zone, the broader short-term trend is likely to remain constructive.
However, a decisive breakdown below this demand band could weaken market sentiment and trigger fresh selling pressure, potentially dragging the index toward 23,600–23,500.
How did Nifty Bank perform?
Nifty Bank opened on a negative note and witnessed mild buying interest in the early session, pushing it to an intraday high before profit booking emerged at higher levels. The index opened at 57,853.75, touched an intraday high of 58,228.65, slipped to a low of 57,803.85, and finally settled at 57,835.35, down 109.65 points (-0.19%). Despite the weak close, the index continued to trade above all its key moving averages, indicating that the broader trend remains constructive.
The recent price action reflects a narrow consolidation range, with small-bodied candlesticks suggesting indecision as buyers and sellers await a decisive directional trigger near the current resistance zone.
The RSI is currently at 53.96, remaining above the neutral 50 mark, indicating that momentum continues to favour the bulls despite some short-term cooling. However, the RSI has eased from recent higher levels, suggesting that upward momentum has moderated. Meanwhile, the MACD remains above the zero line, confirming that the broader trend is still positive.
Although the indicator continues to witness a negative crossover with weakening histogram bars, reflecting fading bullish momentum in the near term. Overall, the indicators point toward a healthy consolidation rather than a reversal, with momentum likely to strengthen again if the index break above the recent swing highs.
On the downside, immediate support is placed around 57,380 (200 DMA). A decisive breach below these levels could lead to profit booking toward 56,980–56,100. On the upside, immediate resistance is seen near 58,230, while a sustained breakout above this level could open the door for a move toward 58,600–58,900 over the coming sessions.
Technically, the index continues to maintain a higher-high, higher-low structure, which keeps the intermediate trend positive. However, investors are likely to remain selective ahead of ongoing earnings announcements and global macro developments. If the index holds above its key DMAs, buying on declines is likely to continue, while a convincing breakout above resistance could trigger fresh momentum-driven participation.
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.