Trade Call: 2 Technical Stock Picks By Sumeet Bagadia On Friday, 2nd Feb

The market saw negative trading on Thursday following the release of the interim budget for 2024-25 by Finance Minister Nirmala Sitharaman. The Sensex lost 0.15 per cent and closed at 71645.30, while the Nifty experienced an intraday decline of 0.13 per cent and closed at 21697.45. Bank Nifty, on the other hand, closed positive, rising by 0.42 per cent and settling at 46188.65.

India VIX closed at 14.45, down 9.97 per cent for the day. Top Nifty gainers were Power Grid Corporation, Cipla, Eicher Motors, SBI Life Insurance, and Maruti Suzuki; losers were Grasim Industries, UltraTech Cement, L&T, Dr. Reddy's Laboratories, and JSW Steel. On the sectoral front, PSU Bank was the top performer followed by auto and banking sector whereas worst performers were media followed by metal and realty sector.

Nifty Outlook

Rupak De, Senior Technical Analyst, LKP Securities said, "Indian equities maintained most of their previous day's gains as market participants welcomed the budget in a very positive way. The Nifty closed above the short-term 21EMA for three out of the last four days, suggesting resilience in the current bullish trend. This bullish momentum in the Nifty is likely to persist as long as the index remains above 21,500. On the higher end, a decisive move above 21,750 might set the Nifty up for a rally towards 22,100-22,200 in the short term."

Bank Nifty Outlook

"The Bank Nifty bulls demonstrated strength as the index closed above the 46000 level on the interim budget day. The overall undertone remains bullish, with support at 47800 providing a cushion for the bulls. On the upside, the immediate resistance is positioned at 46500, and a breakthrough at this level is anticipated to trigger sharp short-covering moves in the market," added Kunal Shah, Senior Technical & Derivative Analyst at LKP Securities.

Market Outlook

Siddhartha Khemka, Head - Retail Research, Motilal Oswal Financial Services said, "Nifty traded in a narrow range post-major event and closed with a loss of 28 points at 26697 levels. Sector-wise it was a mixed bag. Major buying was seen in government companies especially PSU Bank which was up 3% post-FM speech. On the global front, the US Fed concluded by maintaining its status quo and did not hint at an early rate cut which dampened global sentiments. In the Interim Budget, the government emphasized empowering 4 pillars of Viksit Bharat namely Youth, Poor, Women, and Farmers.

Further, the government continues to focus on consolidating the fiscal deficit and investing in infrastructure. Some of the sectors to benefit are affordable housing & finance, infra, railway, defense, and consumption. With two major events now behind, we expect markets to take support from the ongoing earning season and should remain in positive territory."

Stocks To Buy Today

Executive Director of Choice Broking, Sumeet Bagadia has recommended the shares of PI Industries and Sona Blw Precision Forgings on Friday, 2nd Feb.

PI Industries

Buy PIIND in cash @ Rs 3411.15, stop-loss: Rs 3300, target: Rs 3560

In the realm of equity markets, PIIND, currently positioned at 3411.15 levels, showcases a robust technical stance with a comfortable position above key Exponential Moving Averages (EMAs), including the 20-day, 50-day, and 200-day indicators. The recent consolidation phase observed within the range of 3240-3320 levels hints at a potential upward movement, further emphasized by the presence of a bullish candlestick pattern on the daily charts.

An important highlight is the emergence of a modest resistance zone at 3470 levels, serving as a critical juncture for PIIND. A successful breach of this resistance could propel the stock towards the target of 3560 levels and potentially beyond. Investors are strongly advised to closely monitor the stock's performance around this resistance, as it significantly influences the sustainability of the positive momentum in the short term.

Considering this insightful analysis, a prudent strategy might involve contemplating the purchase of PIIND at the current market price (CMP) of 3411.15. To manage risk effectively, setting a stop loss at 3300 provides a protective measure. Simultaneously, aiming for a target of 3560 aligns harmoniously with the potential upward movement indicated by the technical analysis. This strategic approach is crafted to capitalize on the observed positive market conditions, presenting investors with a well-defined plan for entry, risk management, and target achievement within the context of PIIND's existing trading scenario.

Sona Blw Precision Forgings

Buy SONACOMS in cash @ Rs 629.8, stop-loss: Rs 615, target: Rs 666

The analysis suggests a positive outlook for SONACOMS based on the daily chart. The stock has shown a consistent higher high and higher low pattern over the past 06 days, with a recent breakout above the neckline indicating a potential upward movement. The increase in trading volume and the stock trading above the Volume Weighted Average Price (VWAP) for short term is 605 further supports a bullish scenario.

Additionally, SONACOMS is trading above its 20-day, 50-day, and 100-day Exponential Moving Average (EMA) levels, reinforcing the bullish trend. Given these factors, the recommendation is to buy SONACOMS in cash at the current market price (CMP) of 629.8, targeting 666, with a stop-loss at 615.

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.