Nifty consolidation may continue in coming weeks amid results of index heavyweights such as HDFC Bank and ICICI Bank. A range bound to positive movement is likely in the index in coming sessions.
Indian equity markets are on a long break from 14 April to 17 April on account of Ambedkar Jayanti, Good Friday and weekend holidays. Trading activity will resume on Monday (18 April) after remaining suspended for four consecutive days. Benchmark NSE Nifty 50 is expected to prolong ongoing consolidation with positive bias in the range of 17200-17800 in the coming week amid stock specific action. “Buy dips as we do not expect Nifty to breach strong support of 17200 levels,” said analysts at ICICI Direct. Stock specific performance of the broader market is expected to continue. Sectorally, BFSI, Metal themes are expected to do well along with stock specific performances by IT, Capital goods, it added.
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Top stock picks:
Largecap: State bank of India, Axis Bank, Tata Consultancy Services (TCS), Adani Ports, Reliance Industries (RIL), ITC, JSW Steel
Midcap: ABB, Bharat Electronics, Cochin Shipyard, Thermax, Praj Industries, Voltas, Indian Hotels, Rallis, Redington
Nifty: Range bound to positive movement likely
Nifty consolidation may continue in coming weeks amid results of index heavyweights such as HDFC Bank and ICICI Bank. A range bound to positive movement is likely in the index in coming sessions. Sectorally, the banking space may continue to outperform and provide support in case of any extended declines, according to the analysts.
“Going ahead, we believe current levels near 17400-17500 should be crucial for the index as it holds the major Put base for the weekly and monthly settlement. Also, the open interest in index futures is relatively low and high basis prevailing in index futures is normalised once again. Moreover, despite recent sell-off among heavyweights, the volatility index is still hovering below 18 and seems like there should be limited downsides from current levels,” ICICI Direct said.
Bank Nifty: Fresh upsides expected only above 38000
The Bank Nifty traded in a narrow and tight band of almost 500 points throughout the truncated week. There was more of a stock specific action than broad based participation. PSU stocks continued to perform well whereas stocks like HDFC Bank violated their Put base of 1500 and closed below this level. Even though the Bank Nifty index managed to outperform for a few sessions, it failed to sustain follow up momentum and sustain above 38000 levels.
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“We believe fresh upsides would be seen only above 38000 levels now. Until then, there would be stock specific action. We feel the index remains a buy on dip with 37000,” it said. Analysts at ICICI Direct believe that outperformance will resume again in the index once it closes above 38000 levels.
