This was the third consecutive week of gains for the Indian stock market, led by a recovery in global markets, falling US bond yields and a slight drop in the dollar index. On the other hand, regular profit booking limits the gains.
Santosh Mina, Head of Research,
He said that value buying in some heavyweight companies by local investors, and short selling coverage also helped the market rise.
For the week ending June 3, the Nifty50 index rose about 1.5 percent, while sectoral indices such as real estate and information technology rose between 4-5 percent. Pharma and Nifty Bank were down 1-2 percent each.
Speaking of IT stocks, Mina said there was short coverage and value buying from lower levels but added that there was still a risk of selling pressure at higher levels due to uncertain global signals.
He added, “The long-term outlook for the Indian IT sector remains optimistic. Therefore, investors should put together some high-quality names with appropriate valuations.” “Leadership has moved from information technology to sectors facing the local economy.”
Analysts said the real estate sector has been out of pain for several years and is showing strong signs of growth. He adds that one should not look at the sector from a short-term perspective, but it could be a good source of wealth in the next few years.
It was among the most heavily traded stocks during the week. The stock gained 8 percent in the last 5 trading sessions, pushing the index higher. The company’s production volume of 19 crore increased on Friday.
“Overall, the chart structure is bullish for Reliance,” Mina said. “If you can take out the Rs 2,850 level, we can expect a move towards the Rs 3,000 level.”
He adds, “Rs 2,800 – 2,850 is a supply area where profits are expected to be booked. On the other hand, Rs 2,650 – 2,600 would be a strong demand area in any correction.”
Decode technical specifications for
And the analyst has a mixed view about chart counters.
He said that the chart structure of Ultratech Cement looks bearish as there is a breakdown in the head and shoulder formation risking a move towards the Rs 5,000 level, where Rs 5,300 is a medium support level.
“Bajaj Finserv has strong support at the Rs 12,000 level and if it manages to maintain this level we can expect to buy towards Rs 14,000-15,000 while Rs 11,500-11,000 is the next support level.”
Indian stock markets are eagerly awaiting the outcome of the upcoming Reserve Bank of India policy meeting scheduled for June 6-8.
According to a market expert, Nifty is facing resistance around the 16800 level after a smart rally of more than 1,000 pips.
“16400-16350 is a critical demand area that the bulls need to protect to maintain strength in the market. Otherwise, the general downtrend may gain momentum as the next support area will be 16000-15700,” he added. “On the upside, 16,800-17,000 will remain key supply areas.”
Ahead of the much-awaited monetary policy meeting from the Reserve Bank of India, investors will be watching financial stocks closely. Mina is optimistic about the sector. He also advised profit-taking in commodity stocks as global governments look to rein in inflation.
Banking stocks are outperforming in the early stage of the rate-raising cycle due to improved margins while the outlook for the banking sector is optimistic because the worst of the NPA cycle is overdue and there is strong momentum for loan growth, he adds.
“We are optimistic about banks facing companies while investors should be selective in NBFC shares,” he suggested. “Investors should avoid stocks with high debt on the books, unrealistic valuations, and corporate governance issues.”
Head of Research at Swastika is positive regarding insurance stocks, which are showing strength. “There is a bullish cup and handle pattern breakout in stock
Where you might see the Rs 630 level which is close to the 200-DMA; Above this, Rs 655 is the next target level.”
(Disclaimer: Recommendations, suggestions, views and opinions provided by experts are their own. These do not represent the views of the Economic Times)