HDFC Securities Strategist Recommends HDFC Gold ETF and Oil India Shares for Near-Term Investment Consideration

Indian Stock Market Experiences Significant Selloff Amid Rising Tensions in West Asia

The Indian stock market experienced a significant selloff during morning trading on Monday, March 2, as rising tensions in West Asia negatively impacted already wary market sentiment amid foreign capital withdrawals, geopolitical uncertainties, and lackluster earnings.

Key Market Indices

• Sensex: began the day 2,743 points, or 3.34% lower at 78,543.73, but quickly reduced its losses. By around 14:04 IST, it was down 1,565.13 points, or 1.92% trading at 79,690.80.
• Nifty 50: plummeted by over 500 points, exceeding 2%, reaching an intraday low of 24,645 but quickly regained some ground, trading 462.10 points, or 1.9% lower at 24,724 around 2 PM.

Read also: Treasury Yields Experience Largest Increase in Two Weeks Following Release of Labor Market Data

Market Capitalization and Currency

• Investors faced a loss exceeding ₹8 lakh crore, causing the total market capitalisation of companies listed on the BSE to fall from ₹463.50 lakh crore to ₹455 lakh crore.
• The rupee fell by 21 paise to 91.29 versus the US dollar on Monday, influenced by rising crude oil prices, a robust US dollar, and heightened global instability stemming from increased tensions in the Middle East.

Market Views

• According to Vinay Rajani, Senior Technical and Derivative Analyst, HDFC Securities, the Nifty 50 has witnessed a huge gap down today on the back of emerging geopolitical issues.
• The index has reached below all key moving averages, turning the positional trend on the downside.
• A break below 24,576 could drag the index further towards 100-week exponential moving average support placed at 24,060 odd levels.
• On the higher side, 25,000-25,200 could offer strong resistance in the index.

Read also: US-Iran Tensions Spark Uptick in Oil Prices Amid Global Market Decline

Stock Recommendations

• Buy HDFC Gold Exchange Traded Fund (HDFCGOLD): target price ₹155, stop-loss ₹132. The ETF has been forming higher tops and higher bottoms on the weekly charts and has been finding support on its 50 DEMA.
• Buy Oil India: target price ₹520, stop-loss ₹450. The stock has been placed above all key moving averages, indicating an uptrend on all time frames.