Stock recommendations for 26 September from MarketSmith India

Sectoral performance reflected the bearish sentiment, with most indices ending in the red. Nifty Realty and Nifty IT were the top laggards, falling 1.65% and 1.27%, respectively. The weakness was driven by persistent concerns over U.S. visa policy changes and cautious real estate demand. In contrast, Nifty Metal was the only sector to buck the trend, closing with a marginal gain of 0.22%, supported by a rise in global copper prices.

MarketSmith India's Best Stock Recommendations for the Day

Buy: Dr. Agarwal's Health Care Ltd (current price: ₹ 481)

• Why it’s recommended: Strong market leadership in eye care, asset-light growth model & scalability, integrated services, and diversified revenue streams Key metrics: P/E: 140, 52-week high: ₹494.50, volume: ₹37.32 crore
• Technical analysis: Double bottom formation breakout
• Risk factors: High dependence on surgical revenue, geographic concentration risk, doctor and staff retention risk, regulatory & compliance exposure
• Buy: ₹ 478–485
• Target price: ₹550 in two to three months
• Stop loss: ₹450

Buy: Hindustan Zinc Ltd (current price: ₹466)

• Why it’s recommended: Dominant domestic market share & diversified metals portfolio, cost leadership through integration, and operational efficiency
• Key metrics: P/E: 18.57; 52-week high: ₹547; volume: ₹ 333.53 crore
• Technical analysis: Reclaimed its 50-DMA on above average volume
• Risk factors: Commodity price volatility & cyclicality, capital intensity & capital allocation stress
• Buy at: ₹460–470
• Target price: ₹550 in two to three months
• Stop loss: ₹ 428

Nifty 50 recap

Nifty 50 ended at 24,890.85, down 166.05 points or -0.66% for the day, after opening near 25,034 and swinging in a range roughly between 24,878 and 25,092. Broad market breadth remained weak, as declines outnumbered advances—though it could not locate a verified published advance-decline ratio for today. Sectorally, the weakness was led by IT and financial names, pressured by negative sentiment around U.S. visa fee changes and persistent foreign outflows.

Gains in energy and select commodity names provided some support. However, it was not enough to offset the pressure. The market breadth was overwhelmingly negative, with the advance-decline ratio on the NSE standing at 912 advances to 2,124 declines, indicating widespread selling pressure across the board.

The index entered a consolidation phase after facing strong resistance near 25,450, triggering profit-booking post the recent upward movement. On the downside, the index is currently retesting a crucial confluence support zone formed by the 50-DMA, 100-DMA, and the breakout region of the downward sloping trendline, making this a pivotal area for near-term trend confirmation. Momentum readings are turning cautious.

The RSI slipped below its upward bias, breaking its own trendline support and is now placed at 46, reflecting weakening strength. Furthermore, the MACD has registered a negative crossover above the zero line, indicating a loss of bullish momentum and raising the probability of extended consolidation or corrective bias.

According to O'Neil’s methodology of market direction, the market status has been downgraded to an "Uptrend Under Pressure" as Nifty breached its "50-DMA" and the "distribution day count" is at one.

The index extended its losing streak and is currently testing a key confluence of support at the 50-DMA, 100-DMA, and the recent downward-sloping trendline breakout zone. Critical support is placed at 24,800, and a decisive breach below this level could accelerate selling pressure, dragging the index lower toward 24,400.

On the upside, immediate resistance is capped near 25,100. A sustained move above this level would be required to signal renewed strength and potentially reverse the current corrective phase. Until then, the index is likely to remain volatile, with price action around the 24,800–25,100 range determining near-term direction.

How the Nifty Bank Performed

Bank Nifty opened on a weaker footing, remained volatile throughout the session, and closed in negative territory. On the daily chart, it formed a bearish candle with a lower-high lower-low pattern, reflecting sustained selling pressure. The index continues to trade between its 21- and 50-DMA, signalling indecision. For the day, Bank Nifty opened at 55,061.65, touched a high of 55,276.65, slipped to 54,903.30, and closed at 54,976.20. This price action underscores a defensive tone, with participants reluctant to take aggressive positions until clarity emerges.

Momentum signals remain soft, reinforcing the fragile market structure. The RSI has eased to 48, highlighting weakening trend strength, while the MACD maintains a positive crossover, limiting downside conviction. According to O’Neil’s methodology, Bank Nifty is in an “Uptrend Under Pressure," reflecting a trend that remains intact but vulnerable. This setup calls for selective exposure with tighter stop-losses near key pivots. A dip in RSI toward 30–35 could trigger oversold bounces, though follow-through is likely to remain weak until momentum improves.

Technically, Bank Nifty is nearing a critical zone. Resistance is placed at 55,500–55,700, where a sustained breakout could open the way toward 56,600 and 57,200. On the downside, support is positioned at 54,800–54,900, with a breakdown threatening accelerated declines. Between these levels, range-bound consolidation cannot be ruled out as the market digests recent weakness. Until a directional breakout occurs, tactical strategies such as fading extremes within the band, coupled with disciplined risk management, remain advisable. Market sentiment is likely to stay cautious, reactive to data and sector cues.

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.