Investor Strategist Sumeet Bagadia Identifies Five Key Stocks for Consideration

Indian Equity Markets Decline Amid Rising Geopolitical Concerns

The Indian equity markets remained under pressure on Friday, May 8, as rising geopolitical concerns after reports of Iran-US clashes near the Strait of Hormuz dampened investor sentiment. The Nifty 50 and Sensex benchmark indices declined by over 0.50%, with the Nifty 50 falling 0.55% to close at 24,193. The Sensex, on the other hand, declined 0.67% to end at 77,321.

Despite heightened intraday volatility, both benchmarks recorded weekly gains of more than 0.70%. The broader market showed a mixed trend, with the Nifty Smallcap 100 rising 0.22%, while the Nifty Midcap 100 slipped 0.15%.

The Nifty 50 opened with a gap-down at 24,233.65 and witnessed weakness throughout the session. The index recorded its intraday high of 24,253.00 in the first half, while selling pressure intensified in the latter half, dragging the index to an intraday low of 24,126.65. The index eventually closed at 24,176.15, registering a decline of 150.50 points or 0.62% over the previous close.

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According to Sumeet Bagadia, Executive Director at Choice Broking, the formation of a bearish candlestick pattern indicates sustained selling pressure and moderation in bullish momentum. From a technical perspective, immediate support is placed in the 24,000-24,080 range, while resistance is observed between 24,330 and 24,400 levels. The Relative Strength Index (RSI) stands at 52.40, remaining above the midpoint of 50 but indicating weakening momentum.

Nifty 50 vs. Bank Nifty

The Bank Nifty index opened with a gap-down at 55,783.95 and faced selling pressure right from the opening minutes of the session. The index recorded its intraday high of 55,797.70 near the opening level and continued to decline throughout the day, marking an intraday low of 55,062.50 in the second half. The index eventually closed at 55,310.55, registering a decline of 736.85 points or 1.31% for the day.

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Bagadia noted that on the daily timeframe, the formation of a bearish candlestick pattern with the intraday high near the opening level indicates persistent selling pressure throughout the session. From a technical standpoint, immediate support is placed in the 54,800-55,000 range, while resistance is seen in the 55,800-56,000 zone. The Relative Strength Index (RSI) stands at 48.56, slipping below the midpoint level of 50 and indicating weakening momentum with a bearish bias.

Stock Recommendations

Given the ongoing tensions in the US-Iran war uncertainty, Sumeet Bagadia recommends five shares to buy:

1. Asian Paints: Buy at ₹2599.90, Target ₹2800, Stop Loss ₹2490 Asian Paints' share price is showing renewed bullish strength after surpassing its previous swing high and sustaining above the breakout level, indicating strong trend continuation.
2. Kaynes Technology India: Buy at ₹4507.50, Target ₹4900, Stop Loss ₹4300 Kaynes Technology India's share price is trading around ₹4507.50 and witnessing steady buying interest after successfully retesting its recent swing breakout zone, which is aligned with the rising 50-day EMA support.
3. Tata Consumer Products: Buy at ₹1176.20, Target ₹1275, Stop Loss ₹1125 Tata Consumer Products' share price is witnessing positive momentum after breaking out of a short-term sideways consolidation range, indicating fresh accumulation and renewed buying interest.
4. VST Industries: Buy at ₹264.40, Target ₹285, Stop Loss ₹252 VST Industries' share price is showing improving strength after delivering a range breakout and sustaining above the breakout zone, indicating fresh buying momentum.
5. Radico Khaitan: Buy at ₹3477.20, Target ₹3800, Stop Loss ₹3320 Radico Khaitan's share price has recently delivered a rounding bottom breakout on the daily timeframe, indicating a potential continuation of the bullish trend.