HDFC Securities Analyst Recommends NLC India and Apollo Hospitals as Potential Investment Opportunities

Indian Markets Under Pressure Amid Rising Energy Costs and Global Uncertainty

The domestic benchmark indices and the rupee came under pressure on Monday, 11 May, a day after Narendra Modi urged measures such as fuel conservation, curbing imports, and limiting gold purchases amid rising energy costs and pressure on foreign exchange reserves.

India, the world's third-largest oil importer and consumer, indicated late last month that there was no proposal to raise retail fuel prices for diesel and petrol, even as global prices surged. The Nifty 50 declined 1.04% to 23,923.95 as of 11:34 IST, while the BSE Sensex fell 1.17% to 76,426.28. The rupee weakened 0.7% to slip below the 95-per-dollar mark, with the central bank likely intervening to limit further losses.

Indian markets underperformed their Asian peers amid the sell-off. Meanwhile, Brent crude surged over 4.5% to around $106 per barrel, after Donald Trump rejected Iran's response to a US peace proposal, calling it "unacceptable," which reignited concerns over supply disruptions.

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Market Views: Nifty 50 Outlook

India's benchmark Nifty 50 index has significantly underperformed global peers over the past year, declining 3.37% while markets like Korea surged 185%, Taiwan 90%, and Israel 70%. This "Great Divergence" extends to MSCI indices: Emerging Markets up 46%, Developed Markets up 23%, but MSCI India barely moving at 0.07%. Nifty 50 is currently trapped in a narrow 23,800–24,300 range.

Nifty 50 at 24,176 shows flat RSI and MACD, with key support at 23,800 and breakout resistance at 24,600; a decisive move above could reverse its bearish monthly trend. In contrast, mid and small-cap segments shine brightly. Nifty Midcap 100 hit lifetime highs at 61,910 with bullish MACD and RSI, signalling structural upside. Nifty Smallcap 100 rallied 25% from lows (versus Nifty 50's 11%), breaking trendlines, while Microcap 250 gained 28% on fresh breakouts—ideal for dip-buying.

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Market Views: Sectoral Performance

Bank Nifty at 55,310 could see a breakout above 56,350 but risks sliding to 51,900 on weakness below 54,221. Healthcare dazzled with a multi-top breakout at 15,416, favouring stocks like Apollo Hospitals and Sun Pharma. Commodities bolster industrials: Bloomberg Index, copper, HRC steel, and iron ore have been showing firm uptrends, which signals rising demand for metals and benefiting miners and producers.

Stock Recommendations

For the near-term, two stocks are recommended for purchase:

NLC India share price is trading near its all-time high with bullish momentum, having recently broken out from a bullish inverted head and shoulder pattern on the monthly line charts. Apollo Hospitals share price has recently broken out from bullish inverted head and shoulder pattern on the weekly line charts, with the healthcare index having broken out on the monthly charts.