Nifty’s attempt to surpass 20000-20200 may attract profit booking; BHEL, Hero Motocorp among stocks to buy

By Ajit Mishra

Markets have been moving from strength to strength after reclaiming the record high, with a noticeable rise in the positive momentum. Apart from the rotational buying across sectors, a steady recovery in the global counterparts, especially the US, is further supporting the sentiment. In line with the benchmark index, the broader indices are also seeing a stable rise. While the midcap index is already at a record high, the smallcap index has recovered strongly in the last four months and is trading just 4% from that mark.

On the benchmark front, we recommend planning fresh positional trades on dips around the key support zone. At the same time, trends could be mixed on the sectoral front wherein we are eyeing consolidation in the IT after the recent slide while auto and FMCG may see some profit taking too. At the same time, we feel banking, financials, pharma and metal would continue their northward bias so plan your stock-specific positions accordingly.

Nifty (CMP: 19,672.35)

Nifty has almost tested the new milestone i.e. 20,000 and gained over 7% in the last four weeks, which has pushed the oscillators into the overbought zone. It would be healthy if we see some consolidation now, before making further progress. In case of any dip, we believe Nifty would respect the 19,300-19500 zone i.e. the previous consolidation area while any attempt to surpass the 20,000-20,200 zone may attract profit booking.

Bank Nifty (CMP: 45,923.05)

The banking index has regained momentum of late and is likely to inch gradually upward toward the 49000+ zone. We are seeing participation across the pack but we reiterate our preference for the private banking majors citing less volatility and their overall positioning.

Stocks to Watch

Bullish –BHEL, Canbk, Colpal, Gail, Heromotoco, IDFC First Bank, Marico, ONGC, Tatacomm

Bearish – IEX, Jublfood, UPL, Voltas

(Ajit Mishra, SVP- Technical Research, Religare Broking. Views expressed are the author’s own. Please consult your financial advisor before investing.)

Rupee rises 7 paise against US dollar in early trade

The rupee was trading in a narrow range and appreciated by seven paise against the US dollar in early trade on Wednesday, amid a muted trend in domestic equities.

Forex traders said the rupee is trading in a narrow range as investors remain cautious ahead of the BRICS summit and US Federal Reserve Chair Jerome Powell’s speech at Jackson Hole Symposium this week.

On Tuesday, the rupee had recovered from its all-time low levels and settled higher by 14 paise at 82.99 against the US dollar.

“Market awaits with baited breadth the Jackson Hole Symposium between 24th and 26th in which Fed Chairperson’s speech will be keenly watched,” said Anil Kumar Bhansali, Head of Treasury and Executive Director, Finrex Treasury Advisors LLP.

Meanwhile, the dollar index, which gauges the greenback’s strength against a basket of six currencies, fell 0.08 to 103.48.

Brent crude futures, the global oil benchmark, rose 0.17 per cent to USD 84.17 per barrel.

In the domestic equity market, the 30-share BSE Sensex was trading 8.36 points or 0.01 per cent higher at 65,228.39. The broader NSE Nifty advanced 8.20 points or 0.04 per cent to 19,404.65.

Foreign Institutional Investors (FIIs) were net sellers in the capital markets on Tuesday as they offloaded shares worth Rs 495.17 crore, according to exchange data.