Top Stock Recommendations: Sagar Doshi of Nuvama suggests Abbott India, Dabur, and Federal Bank today

Stock Market News: The domestic benchmark indices, the Sensex, and the Nifty 50 had a dramatic all-out selloff on Tuesday, June 4, as trends in the vote-counting process suggested that the actual results differed greatly from the predictions made by the exit polls.

The Nifty 50 concluded with a loss of 1,379 points, or 5.93%, at 21,884.50, while the Sensex finished with a massive loss of 4,390 points, or 5.74%, at 72,079.05.

Investors suffered a one-day loss of about ₹31 lakh crore as the total market capitalisation (m-cap) of the companies listed on the BSE fell to almost ₹395 lakh crore from almost ₹426 lakh crore in the last session.

Also Read: Stock market today: Nifty 50 records biggest single-day fall in over 4 years; Sensex crashes over 4,000 points

While the India bloc makes significant gains, investors are discouraged that the Bharatiya Janata Party (BJP) did not get a majority of votes.

According to market experts, the negative takeaway from ‘Election Results 2024’ was that the street is still not out of the woods yet, as there is still too much of uncertainty in the outcome of the 2024 Lok Sabha election results. Volatility is likely to be the hallmark of near-term trading.

Nifty 50 Outlook by Sagar Doshi, Senior Vice President- Research, Nuvama Professional Clients Group

The Nifty 50 ended nearly 6% lower at the outset of the general election outcome. The Nifty 50 maintained its historical volatility by moving 9% from its day high to low, which has also been its range for the past 2 decades on general election result day. The 200 DMA support now stands at 21,100 odd, while today’s candle on Nifty has to be taken out on either side for it to move in either direction. The verdict on a closing basis on daily charts, indicates that lower levels are likely to come with 22,300 as an intermediate supply zone. Today’s low of sub-21,300 is likely to be retested once again.

Also Read: Share market today: 21 of Nifty 500 stocks rally upto 7% despite market crash; Marico, Hero MotoCorp hit record highs

Bank Nifty Outlook

Bank Nifty tested its 200 DMA during the panic sell-off, underperforming Nifty 50 while closing 800 pt off the day low. Overall, the index witnessed the highest intraday fall in absolute terms during the day, dropping close to 5,000 points during the day. 47,700 is likely to act as a supply zone, while a retest of 200 DMA at 46,200 is likely to be tested again.

Also Read: Will PSU stocks face more sell-off pressure after a 25% drop?

Top Stock Recommendations by Sagar Doshi

On top stock recommendations for Wednesday, Sagar Doshi has recommended three stocks:

Abbott India Ltd (Buy): LCP: ₹26,340 ; Stop Loss: ₹25,500 ; Target Price: ₹29,600

According to Sagar, the stock has given 6 months consolidation break out . stock may gain momentum as the stock has given short-term falling trendline breakout and the defensive sector likely to lead post high volatility phase. Momentum is likely to escalate once a close above 26,900 is seen. This breakout can potentially gain at least 10% higher from CMP.

Dabur India Ltd (Buy): LCP: ₹578; Stop Loss: ₹550; Target Price: ₹610

According to Doshi, the stock has reversed from 21 DMA on quarterly chart which acted as strong long-term demand zone. Monthly and weekly chart also shows consolidation breakouts which suggests stock can move higher from current levels. FMCG is likely to lead as a sector after a long period of underperformance.

Federal Bank Ltd (Sell): LCP: ₹156; Stop Loss: ₹163; Target Price: ₹142

Sagar stated the stock has formed a lower top and lower bottom formation on charts. Long-term charts are showing negative divergence which is the reason of supply coming for every rise in the prices. Further selling pressure to accelerate near 158-160 range. On downside 140-142 level may get retest in coming days.

Also Read: Election Results 2024: FPI net sellers worth ₹12,436.22 crore in the markets: Experts expect near-term volatility

Disclaimer: The views and recommendations above are those of individual analysts, experts, and brokerage firms, not Mint. We advise investors to consult certified experts before making any investment decisions.