Motilal Oswal Analyst Recommends Siemens Energy and Ipca Laboratories for Short-Term Investment

Indian Stock Market Faces Pressure Amid Global Uncertainty

The Indian benchmark indices opened lower on Wednesday, weighed down by rising global bond yields and ongoing uncertainty surrounding the Iran conflict. This fresh pressure on emerging markets has led to a decline in the Nifty 50, which fell 0.22% to 23,566.05. The Sensex also followed suit, dropping 0.27% to 74,996.58 as of 11:20 IST.

The rupee has been particularly affected, weakening to a fresh record low of 96.8650 against the US dollar for the seventh straight session. This marks a 6% decline since the Iran war began on 28 February. The currency's depreciation has been driven by persistent foreign outflows and the ongoing conflict in Iran.

Asian stock markets have also declined for the fourth straight session, with investors remaining wary ahead of earnings reports from AI chipmaker Nvidia. Concerns about rising global borrowing costs have added to the market's uncertainty. In addition, government bond yields in both the US and Japan have reached levels not seen in decades, driven by high crude oil prices and the ongoing conflict in Iran.

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

This has heightened global inflation concerns, which are weighing on market sentiment. The Nifty 50 has recently been consolidating in a broad range of 23,300-23,900, a time-wise correction driven by global factors such as rising bond yields, rising Brent Oil Prices, and a depreciating INR.

Ruchit Jain, Head - Equity Technical Research, Wealth Management at Motilal Oswal Financial Services, notes that the directional move in the index is expected only on a breakout on either side of this range. Until then, traders should focus on stock-specific moves.

Jain recommends Ipca Laboratories Ltd and Siemens Energy India Ltd as shares to buy or sell in the near-term. Siemens Energy has recently broken out of a bullish cup-and-handle pattern, with the neckline resistance now acting as a support on declines. The stock seems to be resuming its broader uptrend, making it a potential buy for short-term traders at ₹3,280-3,300 with a potential target of around ₹3,600.

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

Ipca Laboratories, on the other hand, has given a consolidation breakout with rising volumes, and the RSI oscillator is hinting at a continuation of the positive momentum. Short-term traders can look to buy the stock in the range of ₹1,650-1,640 with a potential target of around ₹1,744. The stop loss on long positions should be placed below ₹1,600.