Stocks to buy: Nagaraj Shetti recommends Jamna Auto, Hindustan Copper shares to buy in the short-term
Indian benchmarks Sensex and Nifty 50 opened higher on August 6, driven by falling crude oil prices and Reliance Industries' gains. The RBI maintained the repo rate at 5.25%, supporting investor sentiment amidst mixed global markets and net selling by FIIs.
Stock market news: Indian benchmark indices Sensex and Nifty 50 opened slightly higher on Thursday, 6 August, supported by a decline in crude oil prices and buying interest in Reliance Industries, despite mixed global market cues.
The Sensex rose 201.43 points to 78,782.43 in early trade, while the Nifty 50 gained 16.35 points to 24,641.
The benchmark indices have witnessed divergent closing trends since Monday, following the introduction of the Closing Auction Session (CAS) for stocks with futures and options (F&O) contracts. The new auction-based mechanism, implemented in the equity cash segment, aims to improve the transparency and efficiency of the closing price discovery process.
Investor sentiment remained supported after the Reserve Bank of India (RBI) kept the repo rate unchanged at 5.25% for the fourth consecutive policy meeting on Wednesday and retained its 'neutral' policy stance. RBI Governor Sanjay Malhotra said future decisions on interest rates and the policy stance would remain data-dependent, as the central bank assesses whether higher energy prices arising from the West Asia conflict translate into broader inflationary pressures.
In Asia, markets traded mixed, with Japan's Nikkei 225, South Korea's KOSPI, and Hong Kong's Hang Seng declining, while China's Shanghai Composite edged higher.
Overnight, US markets ended mostly lower. Meanwhile, Foreign Institutional Investors (FIIs) remained net sellers, offloading Indian equities worth ₹943.42 crore on Wednesday, according to exchange data.
Market Views - Nagaraj Shetti, Senior Technical Research Analyst of HDFC Securities
Nifty 50
After witnessing a stellar upmove recently, the Nifty 50 seems to have shifted into minor profit-booking from the highs over the last couple of sessions. But the recently introduced late-session CAS (closing auction session) saw a sharp uptick in the Nifty 50 towards the end, erasing the loss completely and closing in the green on Wednesday.
After a decisive breakout of crucial overhead resistance of 24,300-24,400 levels few sessions back, the market is currently retracing down towards the previous breakout area. This lower base could be a buying opportunity as per the concept of change in polarity.
The near-term trend of Nifty 50 remains positive. Any upside from here could find overhead resistance around 24,800 levels. However, further weakness from here could find support around 24,400-24,300 levels for a bounce back.
Buy Jamna Auto Industries at ₹143, Target ₹155, Stoploss ₹137, Timeframe 1-2 weeks
Jamna Auto Industries share price has witnessed a decisive breakout of few weeks of consolidation so far this week. Bullish chart pattern like higher tops and bottoms is observed on the weekly chart. Volume has started to expand during upside breakout in the stock price and daily RSI shows positive indication.
Buy Hindustan Copper at ₹533, Target ₹575, Stoploss ₹510, Timeframe 1-2 weeks
Last one month’s consolidation movement is expected to end soon, as Hindustan Copper share price showed a significant breakout of larger range movement. The stock price has surpassed the crucial down trendline hurdle around ₹518-520 levels and closed higher. Weekly 10 and 20 period EMA have been surpassed this week. Volume pattern and daily RSI shows positive indication.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.