Nifty 50 on 3 December: Recap
The benchmark indices, Nifty and Sensex, continued their upward momentum on December 3, bolstered by significant gains in public sector banks and heavyweight stocks such as HDFC Bank, State Bank of India, and Reliance Industries. With the government’s capital expenditure plans and expectations of market-friendly decisions is fuelling some optimism. Also, with the Reserve Bank of India’s monetary policy committee, set to meet later this week is adding to some bullish presumptions. Additionally, a notable rise in small- and mid-cap stocks, each gaining about 1%, further contributed to the positive market sentiment.
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Indian stock markets: Way forward
With the bullish expectations getting bolder after three days of rise, the markets have now reached a stage where we have to plan the way forward. As mentioned yesterday, we were anticipating some challenges around the 24500 region (Nifty spot) and that did put a brake on the momentum as the entire second session was spent trying to stage a run. On lower timeframe charts there is a negative divergence that could produce a pullback in this strong sure seen in the Nifty for last three days with the revised support now being at 24400. Yesterday, we had mentioned “….HDFC Bank, ICICI Bank and SBIN will keep the flag flying high…”. As anticipated with an event in Bank Nifty coming up the component counters showed some buzz slowly but steadily. With Bank Nifty PCR showing some Put shorting at lower levels around 52500 one can expect that the trends will continue to show inclination to the upside. Overall momentum suggests that the bullish trends could persist.
Three stocks to buy, recommended by NeoTrader’s Raja Venkatraman:
• Gufic Biosciences: Buy at ₹447, stop ₹430, target ₹484
A smallcap pharma stock that has been finding steady buying interest at lower levels saw some strong buying yesterday. The prices have had some strong tailwinds post consolidating in the range of ₹368-400 since August 2024.
• Vardhman Textiles: Buy at ₹511, stop ₹490, target ₹575
VTL is a midcap textile company that reacted sharply after reaching an all-time high recently. With some GST reform expected in this sector the textile stocks are showing some renewed momentum. Strong pullback from Ichimoku supports is inviting some fresh momentum.
• BEL: Buy at ₹312 , stop ₹303 target ₹330
The defence sector is once again attracting attention as the government has once again initiated the spending on all stalled projects. This counter has been doing well and is also outperforming the sector. The move in the last one month has been a series of consolidation until the last few days when a nice rounding at supports is looking to move higher.
Raja Venkatraman is co-founder, NeoTrader.
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 taking any investment decisions.
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