Sumeet Bagadia of Choice Broking Recommends 2 Stocks To Buy On Monday, 31st July

The Indian stock market declined for a second straight session on Friday amid a turbulent week triggered by mixed Q1 results, sustained buying activity of FIIs, a rising dollar index & US bond yields, and spike in crude oil prices. The Bank Nifty index plunged 211 points and ended at 45,468 levels, while the NSE Nifty index ended 13 points down at 19,646 levels. The BSE Sensex lost 106 points and wrapped up the day at 66,160 levels.

Market Outlook

Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services, said "Nifty remained under pressure throughout the session but witnessed some recovery in the last hour to close with a marginal loss of 14 points at 19646 levels on Friday. Sectorially, it was mixed with major buying seen in Realty (+1.8%). Power stocks were in the limelight on the back of attractive valuations and huge investments in the sector. Overall, we expect sectoral rotation in the market, while the Index is likely to remain in the consolidation zone with the ongoing result season. Market will keep an eye on the manufacturing data to be released next week both - globally as well as locally. Also, the Bank of England will announce its rate decision next week on Thursday. Auto sector will be in focus as companies would announce their monthly sales numbers."

Nifty Prediction

"The Nifty opened on a flat note and witnessed volatile price action on Friday. It drifted lower during the first half and witnessed a sharp recovery towards the close which helped it to close off the intraday lows though down ~14 points. On the daily charts, we can observe that the Nifty has closed in the negative for the second consecutive day. It has been trading in a downward-sloping channel and we expect it to consolidate within this channel. It can witness a bounce towards the key hourly moving averages placed in the range 19690 - 19720 from where we expect the selling pressure to resume. On the weekly charts, the Nifty has closed in the negative after rising for four consecutive weeks and which also suggests that the Nifty can consolidate. The momentum indicator has a negative crossover which is a sell signal and thus the pullbacks shall be difficult to sustain. Overall, the short-term outlook remains range bound between 19500 - 20000. Crucial support levels to keep handy are 19540 - 19500 and on the upside, 19700 - 19720 is the immediate hurdle zone," said Jatin Gedia - Technical Research Analyst at Sharekhan by BNP Paribas.

Bank Nifty Prediction

"Bank Nifty opened the gap down and closed and witnessed a weak closing. Though it witnessed a pullback during the last hour of the session, however, the structure still points towards a short-term consolidation. On the weekly chart as well we can observe that the Bank Nifty traded within the range 44700 - 46370 of the penultimate week and thus formed an Inside Bar pattern which makes the extremes of the range crucial levels to watch out for in the short term. A breach of this range on either side shall lead to a move in that direction. Overall, we expect the bank Nifty to consolidate between 46500 - 45000," said Jatin Gedia.

Stocks To Buy On Monday

Sumeet Bagadia, Executive Director of Choice Broking has recommended 2 stocks to buy on Monday, 31st July.

Tata Consumer Products

Buy TATACONSUM in cash @ Rs 859.35, stop-loss @ Rs 840, target price: Rs 890

TATACONSUM is currently trading near 859.35. The stock has formed a hammer pattern on the daily chart indicating the reversal of bearish trend in stock. The Strength is shown by the RSI indicator's current trading range of 54 levels. The stock has moved above 20 Day EMA and has also closed above the same levels and is currently trading above all of the key moving averages. The Bollinger band continues to expand on the daily chart after a squeeze, with the price trading above the band's centre line, indicating the stock's strength. A small resistance is placed near 875 levels; if the stock surpasses this level, it may move towards 890 levels and higher which are also all-time high levels.

With a medium-term target price of 890, we advise purchasing TATACONSUM at the CMP of 559.35. If the price closes below 840, our analysis will be regarded as being invalid.

GAIL

Buy GAIL in cash @ Rs 117, stop-loss Rs 114.5, target price Rs 123

GAIL, currently quoting at 117, has exhibited promising market behavior recently, showcasing a notable weekly breakout above its resistance level at 112. Moreover, the stock has been comfortably trading above its short-term (20 EMA), mid-term (50 EMA), and long-term (100 and 200 EMA) moving averages, indicating strong and sustained upward momentum.

Furthermore, the Relative Strength Index (RSI) stands at 69, signaling strength in the stock's price movement and indicating a positive trend. The RSI's upward trajectory further bolsters the bullish sentiment surrounding GAIL.

Considering these technical indicators, the stock appears to be in a favorable position for potential investors. With the current price at 117, it presents a compelling buying opportunity. Setting a prudent stop-loss level at 114.5 would help manage risk effectively. Investors can aim for a target price of 123, taking advantage of the ongoing bullish momentum.

Disclaimer

The recommendations made above are by market analysts and are not advised by either the author, nor Greynium Information Technologies. The author, nor the brokerage firm nor Greynium would be liable for any losses caused as a result of decisions based on this write-up. Goodreturns.in advises users to consult with certified experts before making any investment decision.