Vaishali Parekh Recommends Three Stocks to Buy Amid the Nifty's Recent Gain

Indian Stock Market Nosedives for Third Straight Session

The key benchmark indices of the Indian stock market remained under the bears' grip for the third straight session last week. The Nifty 50 index crashed 679 points in these three sessions, while the BSE Sensex nosedived over 2,600 points from Wednesday to Friday last week. The Bank Nifty index, which ended at 57,371 on Tuesday, finished at 56,089, losing nearly 1,300 points in three straight sessions.

Among sectors, the IT index corrected sharply, shedding over 10 per cent, whereas, despite weak market sentiment, the FMCG and Energy indices rallied over 2 per cent. During the week, due to profit booking at higher levels, the market slipped below the 50-day SMA (Simple Moving Average) of 24,300/78,000, and post-breakdown, selling pressure intensified.

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Gift Nifty Signals Gap-Up Opening

Gift Nifty index today opened upside at 24,051 and extended its intraday gains further by hitting today's high of 24,135. This indicates a gap-up opening for the 50-stock index and other indices of the Indian stock market.

Market Outlook

Vaishali Parekh, Vice President — Technical Research at Prabhudas Lilladher, believes the Indian stock market may open gap-up, as the Gift Nifty live chart is trading green with a sizeable margin. However, she maintained that the Indian stock market bias is cautious as the Nifty 50 index slipped below 24,000 during the stock market crash on Friday. The Prabhudas Lilladher expert said the 50-stock index has its next support placed at 23,500. Breaking below this support, the index may try to test the 23,000 levels.

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Nifty 50 Outlook

Vaishali Parekh said the Nifty 50 index tanked heavily, crashing below the 24,000 zone, with profit booking seen and sentiment in a very cautious mode among market players. The index losing steam once again would have the important support zones at 23,500 and 23,000 levels, which can be retested, as mentioned earlier, and would need to sustain the zone to maintain the overall trend intact. On the upside, the zone near the 24,300 level would be the crucial resistance which needs to be breached to improve the bias.

Bank Nifty Outlook

Parekh said the Bank Nifty index slipped below the important 50-EMA at 56,300 during the session, with the bias turning weak, and closed near 56,000, with sentiment precariously placed for the coming sessions. As mentioned earlier, the important support at 55,000 and thereafter, 53,500 levels shall be the crucial zone which needs to be sustained in the coming sessions, failing which one can expect further weakening of the trend. On the upside, the 200-period MA at the 57,300 level would be an important hurdle which needs to be breached decisively above.

Stock Recommendations

Regarding stocks to buy today, Vaishali Parekh recommended buying these three stocks:

1. Tata Power: Buy at ₹433, Target ₹442, Stop Loss ₹425
2. SAIL: Buy at ₹177, Target ₹182, Stop Loss ₹174
3. TCI: Buy at ₹942, Target ₹965, Stop Loss ₹930