Dharmesh Shah recommends these two stocks to buy tomorrow
The Midcap index rose 4%, which is the biggest weekly rise in the last seven months. The Small cap index surged 7%. According to analysts, the Nifty Bank witnessed a noteworthy surge of more than 2%, marking its largest weekly advance in the past four months.
On Friday’s session, the Sensex witnessed modest gains and touched a fresh lifetime high of 74,248 following the RBI MPC announcement. Meanwhile, despite ending on a flat note, the Nifty 50 ended the week on a higher note and also claimed a new record high.
S&P BSE Sensex and Nifty 50 both saw weekly gains of around 0.8%.
The Nifty 50 ended Friday’s session at 22,513.70, down 0.95 points or 0%, while the 30-share BSE Sensex closed higher by 20.59 points or 0.03% at 74,248.22 level.
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By the end of the week, volatility rose as a result of rising US bond yields, rising crude oil prices, and escalating geopolitical tensions, according to Vinod Nair, Head of Research, Geojit Financial Services. Concerns about food inflation and heat wave alarms subdued market mood even as the RBI’s policy meeting met expectations.
With the release of the Q4FY24 results in the following weeks, investors are anticipated to keep a careful eye on developments. The auto sector anticipates positive results in Q4 due to volume growth in the premium segment and higher price realisation, said Nair.
Further on Monday’s session, the street will get a chance to react to US Jobs report released on Friday. This data will be closely watched by the US Fed before it rolls out its rate cut plans.
According to a Reuters article, US employers raised wages in March and employed many more people than anticipated, indicating that the economy concluded the first quarter on strong footing.
In its carefully awaited employment report on Friday, the Labor Department’s Bureau of Labor Statistics reported a 303,000 rise in nonfarm payrolls last month.
The coming week is a truncated trading week, as on Thursday, April 11, the domestic stock markets will remain close on account of Eid celebrations.
Market Outlook by Dharmesh Shah, Vice President, ICICI Securities
The breakout from one month consolidation (22,525-21,710) helped the index clock a fresh all-time high of 22,619. Going ahead, we reiterate our positive stance and expect Nifty 50 to head towards 23,400 by the general election outcome, while the short-term milestone is placed at 22,900 in the coming weeks. The index is showing resilience despite global volatility, signalling a pre-election rally is brewing up in tandem with historical election-year price-behaviour. Thus, any temporary breather should be capitalised as an incremental buying opportunity as strong support is placed at 22,100, said Dharmesh Shah, Vice President, ICICI Securities.
Shah’s positive bias is further validated by the following observations:
A. The Bank Nifty is expected to resolve out of three-month consolidation (48,600–44,450) that would further strengthen the leadership of BFSI in the next leg of the up move. As we expect, Bank Nifty to head towards 49,800, while strong support is placed at 47,500, which we expect to hold.
B. The current up move is backed by broad-based participation as the percentage of stocks above 50days ema rebounded strongly from its bearish extreme (20% levels) to the current reading of 70%.
C. The midcap index posted a faster retracement of the five-week corrective phase in three weeks and recorded new highs, indicating the continuation of the structural uptrend, while the small cap index is just 2% away from its all-time high.
D. Major industrial commodities like aluminium and copper are coming out of prolonged base formation; they were up 4%-6% last week. This supports a bullish stance on metal.
Top Stock Recommendations:
Buy Reliance Industries Ltd (RIL)in the range of ₹2,920–2,958 for the target of ₹3,270 with a stop loss of ₹2,790.
Buy LIC Housing Finance Ltd in the range of ₹628–644 for the target of ₹720 with a stop loss of ₹599.
Disclaimer: The Research Analyst or his relatives or I-Sec do not have actual/beneficial ownership of 1% or more securities of the subject company, at the end of 05/04/2024 (preceding date) or have no other financial interest and do not have any material conflict of interest.
The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decisions.
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Published: 07 Apr 2024, 12:46 PM IST
