NEW DELHI: Benchmark indices plunged amid a selloff across sectors on Wednesday, taking their losses to the fourth session in a row, as fears of a second wave of Covid-19 infections spooked investors on Dalal Street.
Prime Minister Narendra Modi expressed concern over a rise in coronavirus cases in parts of the country and called for “quick and decisive” steps to check the “emerging second peak”.
The 30-share pack Sensex sank 562.34 points or 1.12 per cent to close at 49,801.62. Its broader peer NSE Nifty tanked 189.15 points or 1.27 per cent to settle at 14,721.30.
“Indian market remained in negative territory as investors traded cautiously ahead of the US Fed meeting coupled with a resurgence in covid cases. Adding to that, the rise in international crude prices is also dragging the Indian market. On a consensus basis, an accommodative policy is expected by the Fed, which will help the global market to stabilize,” said Vinod Nair, Head of Research at Geojit Financial Services.
Investors’ wealth fell by Rs 3.6 lakh crore as the total market capitalisation of BSE-listed firms declined to Rs 203.67 lakh crore.
Market at a glance
- BPCL plunges 5% after dividend disappoints investors
- SBI Card tanks 4% as CA Rover Holdings sells 4% stake
- GMM Pfaudler gains 2% as company buys HDO Tech assets in e-auction
- IPO watch: Laxmi Organic subscribed 103x; Craftsman 4x; Kalyan 1x; Suryoday 0.3x; Nazara 3x
- Broader market stocks hammered; mid- and small-cap indices underperform
Among the blue chip counters, ITC was the top gainer, rising 1.49 per cent. Infosys was the only other gainer.
BPCL was the top loser in the Nifty pack, falling 5.03 per cent. ONGC, Tata Motors, Adani Ports, Coal India, GAIL, Sun Pharma, SBI, SBI Life Insurance and NTPC were others that ended in the red.
Maruti among 10 stocks that may help you beat the Street
Money-making ideas
As benchmark indices remain volatile, analysts are recommending traders to be stock specific, avoid aggressive shorts and stay cautious. Besides the increasing Covid cases in certain parts of India, traders are also worried over the US 10-year yield which is firm at around 1.62%. All eyes are now glued on the outcome of the Federal Reserve meeting tonight.
Here is a handpicked collection of 10 stocks that analysts believe can deliver impressive returns in the next few weeks:
Kotak Mahindra Bank | BUY | Target Price: Rs 2,050
Nifty Bank index in the last four weeks has witnessed a shallow retracement of its strong post Budget rally of more than 25%, thus forming a higher base for the next leg of up move. Within the banking space, the analyst remains constructive on Kotak Mahindra Bank as it is seen taking multiple support at its 50-day EMA (Rs 1,893) and the rising demand line joining lows since September 2020. Among the oscillators, the daily MACD is seen sustaining above its nine-period average, thus validating a positive bias. The analyst expects the stock to retest its all-time high of Rs 2,050 in the coming weeks. Maintain a stop loss at Rs 1,840 on a closing basis.
(Analyst: Dharmesh Shah, Head – Technical, ICICI direct)
Titan Company | BUY | Target Price: Rs 1,615
The share price of Titan remains in a structural up trend, forming higher peak and higher trough in the long term chart. Strong buying demand emerged at major breakout area of November 2020 and the 50% retracement of the previous up move (Rs 1,154-1,621), thus providing a fresh entry opportunity with a favourable risk reward set up. Currently, the stock has taken 10 weeks to retrace 50% of its previous up move of 9 weeks (Rs 1,154-Rs 1,621). Such slower pace of retracement indicates a robust price structure. The analyst expects the stock to head towards Rs 1,615 level in the coming weeks as it is the confluence of the previous all-time high of January 2021 and 123.6% external retracement of its immediate previous decline (Rs 1,588-Rs 1,396). Maintain a stop loss at Rs 1,418 on a closing basis
(Analyst: Dharmesh Shah, Head – Technical, ICICI direct)
L&T Infotech | BUY | Target Price: Rs 4,435
The IT index is resuming its fresh up move after taking a breather in the last two months. Midcap IT stocks are witnessing strong momentum and continuing their primary up trend. The share price of L&T Infotech has generated a breakout above the bullish flag pattern, signaling the resumption of a primary up trend and offering fresh entry opportunity. The stock’s 100-day EMA acted as a strong support point in the entire up move since May 2020. The counter has recently rebounded taking support at its 20-week EMA, highlighting a robust price structure. Based on the above technical observations, the analyst expects the stock to continue its current positive momentum and head towards Rs 4,435 levels as it the 138.2% extension of the previous week up move (Rs 3,570 to Rs 4,015). The analyst recommends keeping a stop loss at Rs 3,890 on a closing basis.
(Analyst: Dharmesh Shah, Head – Technical, ICICI direct)
KEI Industries | BUY | Target Price: Rs 575
After moving into a sideways range over the last one month, the stock witnessed an up move on Tuesday and closed higher. This pattern indicate chances of a sharp upside breakout of the range of around Rs 525-550 levels. The weekly chart signals positive sequential movement like higher tops and bottoms. A further upside from here could form a new higher top of the sequence. Weekly 14-period RSI has turned up, which signals the strengthening of upside momentum in the stock. Buying can be initiated in KEI Industries Ltd at CMP (Rs 520.35), add more on dips down to Rs 500, according to the analyst who was a target of Rs 575 for the next 3-4 weeks. Place a stop loss at Rs 485.
(Analyst: Nagaraj Shetti, Technical Research Analyst, HDFC Securities)
Broader market indices ended with deep cuts, underperforming their headline peers. Nifty Smallcap declined 2.21 per cent and Nifty Midcap slipped 2.48 per cent. Nifty 500 — the broadest index on NSE — fell 1.54 per cent.
Dalmia Bharat, Varun Beverages, Natco Pharma, KEI International, IEX and GMM Pfaudler were top gainers from the mid- and small-cap indices, climbing in the range of 0-6 per cent.
Indiabulls Real Estate, Indian Bank, PNB Housing, BHEL, L&T Technology Services and Tata Power were major losers from the broader market space, falling in the range of 6-9 per cent.
All sectors ended the day with losses. Nifty PSU Bank plunged the most, dropping 3.77 per cent. Nifty Media and Nifty Realty followed with cuts of nearly 3 per cent each. Nifty Metal and Nifty Auto were other major losers.
“We maintain our cautious view and suggest keeping long positions hedged. We’re seeing profit-taking across the board, except IT and FMCG, so plan your trades accordingly.”
— Ajit Mishra, Religare Broking
Market breadth was in favour of losers, as 837 stocks ended in the green whereas 2,148 counters settled with cuts. As many as 198 securities hit 52-week highs, mostly from the small-cap space. Meanwhile, 44 scrips hit 52-week lows, mostly from the micro-cap space. About 275 stocks hit upper circuit limits and 315 lower circuit limits.
European markets were trading mixed at the last count. London-based FTSE was down 0.39 per cent while Paris fell 0.21 per cent, but Frankfurt managed to rise 0.07 per cent. In Asia, Singapore, Hong Kong and Thailand closed in the green, while the rest of the markets registered losses.
