The market struggled to maintain its intraday highs on Wednesday as selling pressure intensified at those elevated levels. However, a positive takeaway was that every dip was met with a recovery, allowing the index to hold onto some of its gains. As the new series begins, the question remains whether the 23,000 level will serve as the critical pivot point for the trend.
How the stock market performed on Wednesday
Indian equity benchmarks opened FY27 on a strong note, with the Nifty and Sensex rebounding sharply after two consecutive sessions of losses. Optimism over a possible easing of Middle East tensions helped calm fears of rising crude prices and inflation, sparking a broad-based rally across sectors.
The Sensex surged nearly 2,000 points intraday to touch 73,964.58 before profit booking trimmed gains, eventually closing 1,186.77 points higher at 73,134.32, up 1.65%. The Nifty 50 also advanced, hitting an intraday peak of 22,941.3 before settling 348 points higher at 22,679.40, a rise of 1.56%.
Market breadth was robust, with 3,675 stocks advancing against 478 declines, while 90 remained unchanged. This rebound came after a challenging March, when both indices shed over 11%—their steepest monthly fall in six years—amid elevated crude prices linked to the Iran conflict. Despite recent volatility, BSE-listed firms added ₹13 lakh crore in market capitalisation.
Outlook for trading
The market's significant gap-up on Wednesday initially sparked hopes for an accelerated rally, but these expectations faded as prices pulled back to form higher lows throughout the day. Trading remained largely stagnant with stilted intraday moves, resulting in a dull session. As noted last week, price action is still too tentative to draw firm conclusions; the decline appears to be on hold as the market churns listlessly near current levels.
The rupee's weakness persisted, hitting new all-time lows beyond 95 per Dollar. Despite hesitant interventions by the RBI, the currency continues to slide alongside other global peers. Historically, a weak Rupee correlates with bearish or range-bound equities, a trend currently playing out.
Daily charts show that while bearish pressure is contained, a shift in bias requires Nifty to close decisively above 23,000. Despite a robust start to the April series, the outlook remains murky. Investors should favor stock-specific moves and avoid index bets until 23,000 is reclaimed. The RSI remains weak, and the market still needs confirmation from long-term trendline supports. Until quarterly results provide a fresh catalyst, expect continued knee-jerk reactions to US economic data.
Three stocks to trade, recommended by NeoTrader’s Raja Venkatraman
NAM-INDIA (current price ₹865.15)
Buy above ₹870, stop ₹830, target 945 (multiday)
- Why it’s recommended: Nippon Life India Asset Management Limited (NAM India) is a prominent Indian asset manager and the investment manager for Nippon India Mutual Fund (NIMF), overseeing mutual funds, ETFs, AIFs, and offshore funds. While a sharp drop below previous support levels suggests the potential for further declines, the value zone between 800 and 820 has held firm. A decisive bullish candle in this region is now dictating the forward trend. Given the steady improvement in the RSI, there is a strong possibility of further upside; a long position is recommended.
- Key metrics:
- P/E: 39.11
- 52-week low: ₹1003.90
- Volume: 1.61M
- Technical analysis: Support at ₹815, resistance at ₹980
- Risk factors: Potential slow AUM growth, and pressure on fee yields. Market volatility, foreign institutional investor (FII) outflows, and currency fluctuations.
- Buy: above ₹870
- Stop loss: ₹830
- Target price: ₹945 (2 months)
MCX (current price: ₹2469.70)
Buy above ₹2480, stop ₹2400, target ₹2690 (multiday)
- Why it’s recommended: Multi Commodity Exchange of India Limited (MCX) is India’s leading commodity derivatives exchange, maintaining a dominant market share of over 95% in commodity futures as of FY24. Technically, the stock experienced a sharp reaction into the Tenkan-Sen (TS) and Kijun-Sen (KS) bands, followed by a recovery that is now forming a constructive rounding bottom revival. The steady support held at these lower levels bodes well for an upside move should the broader market rebound. With a rising Directional Indicator (DI) signaling strengthening momentum, a long position can be initiated here to target higher levels. Go long.
- Key metrics:
- P/E: 87.20
- 52-week high: ₹2706
- Volume: 3.75M
- Technical analysis: Support at ₹2300, resistance at ₹2600
- Risk factors: Regulatory & compliance risk, technical glitches, system outages, or cyber-attacks and stock valuation risk.
- Buy: above ₹2480
- Stop loss: ₹2400
- Target price: ₹2690 (2 months)
HAVELLS (current price: ₹1190.80)
Sell below ₹1185, stop ₹1225, target ₹1105 (multiday)
- Why it’s recommended: Havells India Limited is a leading fast moving electrical goods (FMEG) company based in Noida, specializing in electrical products for residential, commercial, and industrial use. Currently, price trends remain suppressed as rallies into the TS and KS bands have met with selling pressure, triggering a negative reaction. The appearance of a long-bodied bearish candle, combined with the downward slope of the TS and KS bands, highlights the potential for further decline. With the RSI remaining weak, a short opportunity can be initiated to target lower levels. Go short.
- Key metrics:
- P/E: 50.48
- 52-week high: ₹1624
- Volume: 450.01K
- Technical analysis: Support at ₹1500, resistance at ₹1800
- Risk factors: commodity price volatility (copper, PVC), high-intensity competition, and sluggish demand for its Lloyd consumer business, affecting margins..
- Sell: below ₹1185
- Stop loss: ₹1225
- Target price: ₹1105 (2 months)
Raja Venkatraman is co-founder, NeoTrader. His Sebi-registered research analyst registration no. is INH000016223.
Investments in securities are subject to market risks. Read all the related documents carefully before investing. Registration granted by Sebi and certification from NISM in no way guarantees performance of the intermediary or provide any assurance of returns to investors.
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.