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Fair today: Domestic equity benchmarks Nifty 50 and Sensex broke their three-day losing streak and posted mild gains in the previous session, powered by select heavyweights like Infosys and Bajaj Finance. D-Street is awaiting Indian retail inflation data for November 2024 after market close later today. US inflation in November was slightly higher than in October, driven by food prices and higher hotel rates.
The 30-share BSE Sensex rose 16.09 points or 0.02 percent to close on Wednesday at 81,526.14even as 17 of the voters went backwards and 13 advanced. The broader NSE Nifty broke its three-day losing streak and advanced 31.75 points or 0.13 percent to settle at 24,641.80. The benchmark Nifty 50 has traded within a narrow range of less than 170 points across the three sessions this week after registering gains in the previous three weeks ended December 6.
Mid- and small-cap stocks continued to outperform. The BSE Midcap index rose 0.25 percent, while the Smallcap index rose 0.35 percent. Some analysts also said continued inflows of domestic and mutual fund investors into small- and mid-caps, driven by the prospect of outsized returns, are fueling the rally in the market’s broader indices.
The Nifty 50 index remained above short-term critical moving average, indicating a positive trend. “Despite this, momentum is lacking and there could be a strong upward move once the Nifty finally settles above 24,700. In that case, the Nifty could move towards 25,000. At the bottom, the support is at 24,500,” says Rupak De, Senior Technical Analyst at LKP effects
Bank Nifty has formed a small red candle on the daily chart. However, near-term resistance is encountered around the 53,900-54,000 levels. On the downside, the index will find major support at 52,500, where the recent breakout point lies. “As long as the index remains above the 52,500 level, traders are advised to follow a dip strategy in Bank Nifty,” said Hrishikesh Yedve, AVP of Technical and Derivatives Research at Asit C. Mehta Investment Intermediates Ltd.
US inflation accelerated for the second month in a row in November 2024, reporting the strongest increase in the past seven months, against the backdrop of higher food prices and other sectors. However, this did not stop Wall Street from betting on a new interest rate cut by the US Federal Reserve, the policy announcement of which will follow next week.
The US consumer price index (CPI) rose to 2.7 percent last month compared to a year ago, up slightly from 2.6 percent in October. The increase would be in line with economists’ expectations. Progress in lowering inflation toward the U.S. central bank’s two percent target has virtually stalled, with the Bureau of Labor Statistics report showing no improvement in its measure of underlying price pressures over the past four months.
Sumeet Bagadia, executive director at Choice Broking, recommended two stock picks for today. Ganesh Dongre, senior manager of technical research at Anand Rathi, has suggested three stock ideas. These include Bank of India, MCX, RailTel Corp of India, RCF and HDFC Asset Management Company (AMC).
The stock’s recent short-term trend analysis has revealed a notable bullish reversal pattern. This technical pattern suggests the possibility of a temporary retracement in the stock’s price, possibly reaching around the price ₹122. The stock is currently maintaining a crucial support level at ₹110. Considering the current market price of ₹115, a buying opportunity presents itself. This suggests that investors could consider buying the stock at the current price in anticipation of an increase towards the identified target ₹122.
The stock’s recent short-term trend analysis has revealed a notable bullish reversal pattern. This technical pattern suggests the possibility of a temporary retracement in the stock’s price, potentially reaching around the price ₹190. The stock is currently maintaining a crucial support level ₹175. Considering the current market price of ₹180, a buying opportunity presents itself. This suggests that investors could consider buying the stock at the current price in anticipation of an increase towards the identified target ₹190.
The stock’s recent short-term trend analysis has revealed a notable bullish reversal pattern. This technical pattern suggests the possibility of a temporary retracement in the stock’s price, which could potentially reach around Rs. 6,850. The stock is currently maintaining a crucial support level of Rs. 6,600. Considering the current market price of ₹6,710, a buying opportunity arises. This suggests that investors could consider buying the stock at the current price, anticipating an increase towards the identified target of Rs. 6,850.
RailTel trades on ₹451.50, showing strong bullish momentum after the recent break above the key resistance level of ₹450. The stock has also recently broken out of a descending trendline pattern, which typically signals a potential bullish reversal from a key support zone. Furthermore, RailTel is trading comfortably above the 20-day, 50-day and 200-day Exponential Moving Averages (EMAs), reinforcing the positive trend.
The Relative Strength Index (RSI) stands at 57.15, indicating that the upward trend is healthy with further room for growth. If the stock reaches its position above the critical resistance level of ₹460, this would be an ideal starting point for long positions. This technical setup is supported by a noticeable increase in trading volume, highlighting strong buying interest.
Traders may consider entering at the current price level of ₹451.50, with a stop loss at ₹436 and a target of ₹483. While this setup offers a compelling opportunity for potential profits, it is important to remain cautious about potential short-term volatility despite favorable technical indicators. Good risk management is essential to successfully navigate this trade.
HDFC AMC trades at ₹4,543.85, recently recovered from a key support zone. The stock is about to break out of its consolidation range ₹4,100 and ₹4,550, trading near all-time highs and confirming strong upside momentum.
If HDFCAMC manages to stay above the critical resistance level of ₹4,550, this could be an ideal entry point for long positions, with a potential target of ₹4,861. This breakout is further supported by a noticeable increase in trading volumes, indicating strong buying interest from investors.
The Relative Strength Index (RSI) currently stands at 64.23 and is trending upward, indicating a healthy upward trend with room for further growth. Additionally, HDFCAMC is trading well above its 20-day, 50-day, and 200-day Exponential Moving Averages (EMAs), reinforcing the positive trend.
Traders considering an entry at the current price of ₹4,543.85 may aim ₹4,861, with a stop loss around ₹4,290 to manage risks effectively. While the trading setup appears promising, caution is advised due to the potential short-term volatility. Good risk management remains crucial to successfully manage this trade.
Disclaimer: The views and recommendations expressed in this analysis are those of individual analysts or brokerage firms, not Mint. We strongly advise investors to consult certified experts before making any investment decisions as market conditions can change rapidly and individual circumstances may vary.
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