Stock market today: Trade setup for Nifty 50 to global markets; 5 stocks to buy or sell on Friday — Dec 13

Stock Market Today: Domestic equity benchmarks Nifty 50 and Sensex settled lower in the previous session due to selling pressure logged in select heavyweights, including Reliance Industries, L&T and Hindustan Unilever Ltd (HUL). Weakness in the rupee and foreign fund outflows also hit investors’ sentiment. Nifty IT index was the sole gainer, while all other sectoral indices closed lower.

The 30-share BSE Sensex declined 236.18 points or 0.29 per cent to settle at 81,289.96. During the day, it dropped 314.5 points or 0.38 per cent to 81,211.64. The Nifty 50 settled lower by 0.38 per cent at 24,548. The small-caps and midcaps snapped their 14-session winning streak and dropped one per cent and 0.5 per cent, respectively.

IT stocks extended their winning streak to the fourth consecutive session, driven by heightened expectations of a US Federal Reserve interest rate cut next week. Riding the sentiment, the Nifty IT index surged 1.4 per cent in intraday trade, crossing the 46,000 mark for the first time to hit a fresh all-time high of 46,002.

Government data released post-market hours showed India’s retail inflation, based on the consumer price index (CPI), fell to a three-month low of 5.48 per cent in November from the 14-month high of 6.21 per cent in October.

Inflation fell as vegetable prices cooled due to rising supplies, while factory output growth touched 3.5 per cent, driven by higher consumer durables and garments production. The retail inflation data boosted hopes of an interest rate cut by the Reserve Bank of India (RBI) in the February policy.
 

Trade Setup for Friday

Nifty slipped below the consolidation on the daily chart, indicating a weakening trend in the near term. However, the decline was limited, and it stayed above 24,500. “The sideways consolidation in Nifty may persist for a few more days as the index remains within a defined range. A decisive fall below 24,470 could trigger a meaningful correction in the market. On the higher side, resistance is seen at 24,650-24,700,” said Rupak De, Senior Technical Analyst at LKP Securities.

Bank Nifty has formed a doji candle on its daily chart, indicating uncertainty. It is consolidating within a narrow range during the last few sessions. Only once this consolidation is over can it make a fresh move. “The index is anticipated to consolidate in the band of 52,500-54,000 for the short term. Traders are advised to buy near the support zone and book profit near the resistance zone of 53,800-54,000,” said Hrishikesh Yedve, AVP of Technical and Derivatives Research at Asit C. Mehta Investment Intermediates Ltd.

Global Markets

Wall Street pulled back on Thursday as investors evaluated key economic indicators ahead of next week’s US Federal Reserve meeting. A Labor Department report showed US producer prices rose more than forecast in November, though a moderation in service costs pointed to a continuation of the broader disinflationary trend.

The Dow Jones Industrial Average fell 234.44 points, or 0.53 per cent, to 43,914.12, the S&P 500 lost 32.94 points, or 0.54 per cent, to 6,051.25 and the Nasdaq Composite lost 132.05 points, or 0.66 per cent, to 19,902.84.

Nasdaq had surged past the 20,000 mark for the first time on Wednesday, driven by a strong rally in technology stocks. Meanwhile, the S&P 500 reached its highest level in nearly a week, buoyed by an inflation report that solidified expectations for a 25-basis-point rate cut at the US Fed’s December 17-18 meeting. 

Stocks to buy today

Sumeet Bagadia, Executive Director at Choice Broking, has recommended two stock picks for today. Ganesh Dongre, Senior Manager of Technical Research at Anand Rathi, has suggested three stock ideas. These include Zomato, Tata Teleservices Maharashtra Ltd (TTML), Hindustan Aeronautics Ltd (HAL), Firstsource Solutions Ltd (FSL), and E.I.D-Parry (India) Ltd.

Ganesh Dongre’s day trading stocks
 

1. TTML: Buy at ₹85, Target Price ₹92, Stoploss ₹80

The stock has substantial support at Rs.80, marking a crucial juncture in its recent trading. Presently, at Rs.85, the stock has demonstrated a definitive reversal in price action, suggesting a potential continuation of its upward momentum. Traders keen on seizing this opportunity could consider buying and holding the stock, setting a prudent stop loss at ₹80. The anticipated target for this trade is Rs.92, representing the next significant resistance level. This strategy positions traders favourably to capitalize on the stock’s anticipated rally in the weeks ahead.

2. Zomato: Buy at ₹284, Target Price ₹295, Stoploss ₹278

A notable bullish reversal pattern has emerged in the stock’s recent short-term trend analysis. This technical pattern suggests the possibility of a temporary retracement in the stock’s price, potentially reaching around ₹ 295. The stock is currently maintaining a crucial support level at ₹278. Given the current market price of ₹284 a buying opportunity is emerging. This suggests that investors might consider purchasing the stock at its current price, anticipating a rise towards the identified target of ₹ 292.

3.HAL: Buy at ₹4,650, Target Price ₹4850, Stoploss ₹4,550

On the daily chart of this stock, a breakout at the Rs.4650 price level has been observed, signalling a potential upward trend. Complementing this breakout, the Relative Strength Index (RSI) is still turning up, indicating increasing buying momentum. Given these technical indicators, traders can consider buying on dips, entering the stock at a lower price point. To manage risk, a stop loss at ₹4550 is recommended. The target price for this strategy is Rs.4850 in the upcoming weeks, suggesting a potential gain as the stock continues its upward trajectory.

Sumeet Bagadia’s stocks to buy today

4.FSL: Buy at ₹383.7, Target Price ₹405, Stoploss ₹370

FSL is currently trading at 383.7, which indicates a strong uptrend. The stock has consistently formed higher highs and lower lows over the past several weeks. The price action suggests a rising channel pattern, highlighting sustained bullish momentum. Notably, it recently reached a fresh all-time high of 391.50.

The stock is trading above its 20-day EMA, 50-day EMA, and 200-day EMA, indicating strong support from short-term and long-term trends. FSL holds the potential for further appreciation. Having broken through a key resistance level, if the trend continues and higher levels are breached, the stock could potentially reach a target of 405.

On the downside, immediate support is located at 380. The Relative Strength Index (RSI) is currently at 68.06 and trending upward, reflecting growing buying momentum. To manage risk effectively, a stop-loss at 370 is suggested to guard against unexpected market reversals.

In conclusion, based on the technical analysis and current market conditions, FSL presents a promising buying opportunity for those aiming for a 405 target, provided that appropriate risk management strategies are in place.

5.E.I.D-Parry (India) Ltd: Buy at ₹941.75, Target Price ₹995, Stoploss ₹910

E.I.D-Parry (India) chart reflects a steady rise, with the stock closing at ₹941.75. The stock is gradually recovering after a period of sideways movement. It is now approaching an important resistance level of around ₹950. This level is significant as breaking above it could lead to a stronger upward movement. If the stock can stay strong and move above the current range, especially by breaking past ₹950, it may have room for further upward movement, potentially reaching ₹995.

On the downside, substantial support is evident at nearly ₹910. Furthermore, EIDPARRY trades above key Exponential Moving Averages (EMAs), including the 20-day, 50-day, 100-day, and 200-day EMAs. The Relative Strength Index (RSI) stands at 68.44, signalling an upward trajectory and confirming an increase in buying momentum.

Considering the technical analysis and prevailing market conditions, EIDPARRY presents a promising buying opportunity for those targeting a ₹995 price objective. To manage risk effectively, it is advisable to set a stop-loss (SL) at ₹910 to protect the investment in case of an unexpected market reversal.

Disclaimer: The views and recommendations provided in this analysis are those of individual analysts or broking companies, not Mint. We strongly advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and individual circumstances may vary.