Sagar Doshi Recommends Dr Reddy's, Grasim, and HUL Shares as Potential Investment Opportunities

Indian Stock Market Plunges Amid Crude Oil Price Surge and Iran Conflict Tensions

The Indian stock market started the day on a negative note on Tuesday, with the rupee hitting an all-time low, as high crude oil prices and unstable negotiations to resolve the Iran conflict raised concerns about supply and potential economic repercussions. The Nifty 50 decreased by 0.44% to 23,712.2 at 9:20 IST, while the BSE Sensex declined by 0.56% to 75,590.56.

Of the 16 primary sectors, 10 recorded losses, with the broader small-cap and mid-cap indices falling by 0.5% and 0.3%, respectively. Rising crude prices pose a significant challenge for India, the world's third-largest oil importer, intensifying inflationary pressures and impacting economic growth and corporate profitability.

Investors are awaiting India's retail inflation figures for April, expected later today, which may provide insight into how the conflict in Iran has influenced price dynamics in the economy.

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Nifty 50 Outlook

The Nifty 50 experienced extreme pressure to start the week and failed to recover after a gap-down opening, ending at the lowest point in the day and at a one-month low. According to Sagar Doshi, Senior Vice President- Research, Nuvama Professional Clients Group, the index may slump further if it closes below yesterday's low of 23,800, potentially reaching 23,300. However, a defence of 23,800 today could allow the index to consolidate within the 23,800 – 24,200 range.

Bank Nifty Also Falls

The Bank Nifty also fell in line with the broader Nifty 50, following a week of outperformance, as pressure remained across the board amid a spike in oil prices, uncertainty over the West Asia crisis, and the PM's appeal for a reduction in oil and gold purchases. The Bank Nifty registered a one-month low, allowing pressure to mount further towards 53,700 on the downside if yesterday's low is breached.

Read also: MarketSmith India's 4 June Stock Recommendations

Recommended Stocks to Buy on Tuesday

Sagar Doshi of Nuvama recommended three stocks to buy on Tuesday: Dr Reddys Laboratories Ltd, Grasim Industries Ltd, and Hindustan Unilever Ltd (HUL).

These stocks have shown promising technical indicators, with Dr Reddys Laboratories Ltd breaking out from its 18-month consolidation, Grasim Industries Ltd marking the end of its 22-month sideways consolidation and a breakout from it, and Hindustan Unilever Ltd forming a bullish flag pattern on daily charts.