Market Overview
Domestic equity benchmarks opened lower on Tuesday, with the Sensex declining 365 points or 0.47 per cent to 77,362 and the Nifty trading 76 points or 0.31 per cent lower at 24,211 in morning trade. The dip came as crude oil prices rebounded above $91 a barrel, driven by fading hopes of a US-Iran peace deal.
Sectoral indices reflected mixed sentiment. Nifty IT was the top loser, slumping more than 1 per cent, while Nifty MidSmall IT & Telecom fell 0.62 per cent and Nifty Realty declined 0.4 per cent. Financial services, private banks, media, metals and FMCG indices also traded marginally lower. On the positive side, Nifty Auto gained 0.40 per cent and PSU Bank rose 0.29 per cent.
Geopolitical and Macro Pressures
The selling pressure followed reports that Iran indicated it could adopt a more offensive posture and that US President Donald Trump ruled out an extension to the ceasefire arrangement, intensifying concerns over potential disruptions to energy supplies. Brent crude rose 0.60 per cent to trade above $91 a barrel, while US West Texas Intermediate crude gained more than 1 per cent to $85.37 a barrel.
Additionally, the US 10-year Treasury yield climbed to 4.73 per cent, a level that analysts said could be negative for foreign institutional investor flows. Ahead of the market opening, analysts noted that the rise in Brent crude and the increase in US 10-year Treasury yields likely weigh on equities in the near term.
Domestic Support Factors
Despite the headwinds, analysts pointed to a resilient Indian economy and signs of an earnings growth turnaround as potential supports for domestic equities. They also noted that domestic institutional investors, which hold substantial funds, could step in to buy significant dips, while retail investors may use market declines to gradually accumulate quality stocks for the long term. However, heightened geopolitical uncertainty is likely to keep markets volatile.
Technical Outlook for Nifty and Nifty Bank
From a technical perspective, the Nifty has found support around the 24,000 mark, an important technical zone. Jigar S. Patel, Senior Manager of Equity Technical Research at Anand Rathi Share and Stock Brokers, pointed out that 24,000 is supported by a combination of the daily gap area, rising trendline and the 61.8% Fibonacci retracement of the previous up-move. Therefore, he believes the buy-on-dips strategy remains valid as long as the index holds its key support levels.
Patel said the immediate support zone is at 24,000–24,100. The broader trend remains positive as long as 23,600 holds on a closing basis. On the upside, 24,300 will be the first important hurdle. A sustained move above 24,500–24,750 can improve momentum and open the door towards the 25,000 mark. However, the journey towards 25,000 is likely to be gradual, with intermittent profit-taking and consolidation.
For Nifty Bank, a sustained breakout above 58,200 could trigger fresh buying and drive further gains. On the downside, 57,000 remains a crucial support. A break below this level could weaken the structure and lead to further selling pressure, said Patel.
Short-Term Stock Picks
For the next 1-2 weeks, Patel recommends buying the following stocks:
- Axis Bank: Buy in the range of ₹1,250 to ₹1,235, with a target price of ₹1,335 and a stop loss of ₹1,200. The stock is forming a double-bottom near an important trendline of support, suggesting selling pressure may be weakening and buyers are gradually gaining control. Momentum indicators support the setup, with bullish divergence visible on both the RSI and the MACD. Patel said the divergence indicates that while price has tested or remained near lower levels, momentum has started improving, which can signal an early shift in trend.
- Meesho: Buy in the range of ₹205 to ₹200, with a target price of ₹225 and a stop loss of ₹190. The stock has given a strong breakout above the R4 Monthly Camarilla resistance and moved above the Ichimoku Cloud. Momentum indicators are supporting the breakout, with RSI indicating improving strength, MACD confirming positive momentum, and DMI showing favourable directional strength. Patel said the combination of price breakout and indicator confirmation increases the probability of further upside if the stock sustains above the breakout zone.
- Happiest Minds Technologies: Buy in the range of ₹446 to ₹433, with a target price of ₹500 and a stop loss of ₹410. The stock has witnessed a strong breakout above the R4 Monthly Camarilla resistance along with a decisive move above the Ichimoku Cloud. Patel said this combination suggests that buying interest is gaining momentum and the stock could witness further upside if it sustains above the breakout zone.
(Disclaimer: The stock recommendations and technical views are provided by the analyst and do not constitute investment advice. Investors should consult their financial advisors before making any investment decisions.)