Nifty formed a bullish candle on charts and experts feel that the rally could extend for next couple of sessions.
Good news for investors as Sensex snapped 5-days losing streak on Tuesday. The index closed nearly 350 points higher while Nifty50 reclaimed 11,000 levels.
A large part of the recovery was led by financials such as banks, NBFCs as well as FMCG stocks. On the other hand, realty, telecom, oil & gas stocks saw profit booking.
The recovery came after Life Insurance Corporation assured that it would do all it can to prevent the collapse of beleaguered IL&FS which led to marked improvement in the sentiment.
Also, Reuters in a report said that RBI may look at cutting Cash Reserve Ratio (CRR) or open a separate line of credit for mutual funds which helped markets recover early losses.
Technically, Nifty formed a bullish candle on charts and experts feel that the rally could extend for next couple of sessions.
Two crucial factors will be watched: one is crude oil prices which is hovering around $82/bbl, as well as the outcome of the US Fed policy meeting on Wednesday, will be in focus.
The initial target could extend towards 11170 – 11250 levels. Next immediate resistance is 11,350.
Crucial support is placed at 10,866.
Big News:
The S&P BSE Sensex has fallen 2,684 points, or nearly 7 percent, since August 29, but a big carnage was seen in individual stocks.
More than 200 stocks in the S&P BSE 500 index slipped 10-40 percent during the same period.
As many as 207 stocks in the S&P BSE 500 index have plunged 10-40 percent, including Dewan Housing Finance, Yes Bank, Central Bank of India, Reliance Communications, Bharat Electronics, Adani Power, Jaiprakash Associates, Reliance Capital, IL&FS Transport etc. among others.
In the S&P BSE Small-cap index, as many as 405 stocks have plunged 10-50 percent which include names like Rolta India, Sunil Hitech, IL&FS Investment Managers, Ruchi Soya, Gravita India, Unitech, HDIL, Jet Airways, Escorts, Kwality, Nitco, Vijaya Bank etc. among others.
Technical Recommendations:
We spoke to SMC Global Securities and here’s what they have to recommend:
Bajaj Corp: Buy| Target: Rs 485| Stop Loss: Rs 415| Return 10%
Deepak Nitrite: Buy| Target: Rs 315| Stop Loss: Rs 252| Return 14%
United Breweries: Buy| Target: Rs 1525| Stop Loss: Rs 1260| Return 12%
Disclaimer: The views and investment tips expressed by investment expert on moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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