Trade Call: Sumeet Bagadia Recommends 2 Stocks To Buy/Sell On Friday, Dec 15

Owing to the US FED's dovish narrative at the FOMC meeting, the Nifty 50 reached an all-time high and exceeded the 21,100 barrier for the first time, helping the benchmark indices close on a record high on Thursday. The Nifty was up 256 points at 21,182.70 while the Sensex was up 929 points at 70,514.20 at the closing.

The top 5 losers were Power Grid, HDFC Life Insurance Company, Nestle India, Cipla, and JSW Steel, while the top 5 winners were Infosys, Tech Mahindra, LTIMindtree, Wipro, and HCL Tech. On the sectoral front, all sectors ended in green except media, healthcare and consumer durables. Whereas on the broader market front, the BSE mid-cap index ended by adding 1.06% and small-cap index surged by 0.62%.

Market Outlook

"Indian equities commenced the weekly expiry day on a firm note at a record level of 21,100. As the day progressed, the Index kept registering new highs under the leadership of Tech and Banking stocks to settle at 21,182.70 with gains of 256.35 points. Realty was the top outperformer of the day by ending the day with gains of 3.88% while Media was the only laggard. A mixed trend was observed in the Broader markets where Midcaps more or less moved in tandem with the Frontline Index while Smallcaps underperformed.

With a bullish gap, the Index has breached its congestion zone which implies continuation of the current uptrend with the downside being protected at 21,020, and on the flip side, 21,400 can act as a resistance," said Aditya Gaggar Director of Progressive Shares.

Pranav Haridasan, MD and CEO at Axis Securities said, "The market is eyeing a new high in light of favourable macros. We saw a good recovery last month in Indian equities due to a change in the macroeconomic narrative in favour of the overall equity market. Thanks to the dovish narrative from the US FED in the FOMC meeting, today, the Nifty 50 scaled to an all-time high level and crossed the 21,100 mark for the first time. Several factors contributed to this rally.

There was a nearly 100 basis point decrease in US 10-year bond yields from their recent peak. The status quo maintained by the RBI, with a positive revision in FY24 GDP from 6.5% to 7 %, sequential improvement in the high-frequency indicators, and robust earnings growth expectations, contributed to this momentum.

The election results in three out of four key states have raised the expectations of policy continuity in 2024, boosting market confidence. We can see a further new high in the market if the bond yields and the crude prices remain at the same levels for the entire month. Large caps seem better placed at current levels in terms of overall valuations. Based on a favourable macroeconomic picture compared to other emerging markets, flows may shift towards large caps, especially large-cap banks, in the near term."

Nifty Outlook

Rupak De, Senior Technical analyst at LKP Securities said, "The index has broken out of consolidation, driven by an increase in long positions compared to short trades among participants. Sentiment remains robust as the index maintains a position comfortably above crucial moving averages. Support is situated at 21,000, where Put writers have significant position. Looking ahead, there's a potential for the index to advance towards 21,400 and beyond on the higher side."

Bank Nifty Outlook

Kunal Shah, Senior Technical & Derivative analyst at LKP Securities said, "The Bank Nifty bulls maintained their momentum, successfully surpassing the key resistance level of 47500 with significant trading volumes. The overall market sentiment remains bullish, and any temporary declines are considered buying opportunities, with a strong support level identified at 47000. The ongoing momentum is expected to be driven by active participation from both private and PSU banks, propelling the Bank Nifty index towards the 50000 mark."

Stocks To Buy Today

On Friday, December 15, Choice Broking's executive director, Sumeet Bagadia, recommended purchasing two stocks. Here are the entry price, stop loss, and target price for Jubilant FoodWorks and Bajaj Finance.

Bajaj Finance

Buy BAJFINANCE in Cash @ Rs 7470, Stop-loss: Rs 7210, target: Rs 7910

BAJFINANCE is currently trading at Rs 7,470 and has recently formed a rounding bottom pattern, indicating a strong bullish trend. A potential breakout above Rs 7,515 could propel the stock towards the Rs 7,910 level, with an immediate resistance at Rs 7,730. On the flip side, Rs 7,210 serves as a crucial support level.

Furthermore, BAJFINANCE is trading above key Exponential Moving Averages (EMAs), including the 20-day, 50-day, 100-day, and 200-day EMAs. This signifies a robust bullish trend, suggesting the possibility of continued upward movement. The Relative Strength Index (RSI) is currently at 57, on an upward trajectory, indicating growing buying momentum. Collectively, these technical indicators imply that BAJFINANCE has the potential to reach the Rs 7,910 target in the near term.

To manage risk effectively, it is advisable to set a stop-loss (SL) at Rs 7,210 to protect the investment in case of an unexpected market reversal. A prudent strategy would involve considering buying opportunities on dips at levels around Rs 7,400 and Rs 7,300.

In summary, based on technical analysis and prevailing market conditions, BAJFINANCE appears to present a promising buying opportunity for those targeting a Rs 7,910 price objective. It is crucial to implement prudent risk management strategies to navigate potential market fluctuations.

Jubilant FoodWorks

Buy JUBLFOOD in cash @ Rs 569.05, stop-loss: Rs 555, target: Rs 600.

The stock is currently trading at 515.75 and has exhibited some encouraging signs for potential investors. It successfully breached the 563 level on a closing basis, a key technical level and did so with robust trading volumes, suggesting underlying strength in the stock.

Furthermore, the stock is currently trading above its 20-day, 50-day, and 200-day Exponential Moving Averages (EMAs). This indicates a positive trend in the short, medium, and long-term, respectively.

There is a minor resistance level at 575, but if the stock can overcome this barrier, it may have the potential to reach 600 and potentially higher. This breakout could signify a bullish move in the stock.

Additionally, the Relative Strength Index (RSI), a momentum indicator, is hovering around 68. This suggests that there is strength in the stock's current trend.

With a short to medium-term outlook, one can buy JUBLFOOD at a CMP of 569.05 with a SL of 555 for a target price of 600.