Indian stock market: Fears of a possible U.S. recession have triggered a significant global equity sell-off, heightening investor anxiety. The Nifty 50 fell by 824 points, dropping below 24,000 for the first time since late June, while the S&P BSE Sensex decreased by 2,686 points, reaching an intra-day low of 78,295.
“Nifty index opened gap down by more than 400 points due to weak global cues and witnessed steep fall till 23893 zones. Bears had complete control for the first couple of hours and later the index consolidated. It witnessed slight recovery towards the end and managed to close above 24000 zones near its 50 DEMA. It formed a Bearish candle on daily frame and closed with losses of around 660 points. Now till it holds below 24200 zones, weakness could continue towards 23750 then 23500 zones whereas hurdles are placed at 24200 then 24500 zones,” said Chandan Taparia, Head – Equity Derivatives and Technicals, Broking and Distribution, MOFSL.
India VIX was up 42.63% from 14.40 to 20.42 levels. Volatility shot up above 23 zones at a 40 session high level and paved way for the bears in the market.
On option front, Maximum Call OI is at 26000 then 25000 strike while Maximum Put OI is at 24000 then 23000 strike. Call writing is seen at 24400 then 25000 strike while Put writing is seen at 22600 then 22550 strike. Option data suggests a broader trading range in between 23500 to 24700 zones while an immediate range between 23700 to 24500 levels.
Bank Nifty
On the Bank Nifty outlook, Taparia further added, “Bank Nifty Index opened gap down by more than 700 points due to weakness in global cues and drifted lower towards 49700 zones in the first half of the session. Later it remained consolidative with negative bias and ended with losses of around 1260 points. Index is forming lower highs from the last few sessions and formed a Bearish candle on daily scale to close below its 50 DEMA. Now till it holds below 50500 zones some weakness could be seen towards 49750 then 49500 levels while on the upside hurdle is seen at 50250 then 50500 zones.”
Chandan Taparia has recommended three stocks to buy tomorrow, August 6. According to him, these stocks – Hindustan Unilever, Lupin and Lal Path Labs – are technically placed to see a decent upmove.
Stocks to buy
Hindustan Unilever: Buy at ₹2715 | Target Price: ₹2850 | Stop Loss: ₹2650
HUL is in overall uptrend and holding gains at higher zones. It has retested breakout on daily chart and inching higher. The ADX Indicator has turned up on the daily and weekly scale indicating the up move has strength.
Lupin: Buy at ₹1948 | Target Price: ₹2050 | Stop Loss: ₹1890
LUPIN has given trend line breakout on daily chart with noticeable volumes. Buying is visible across Pharma space which may support the ongoing up move.
Lal Path Labs: Buy at ₹3160 | Target Price: ₹3350 | Stop Loss: ₹1890
LAL PATH LABS has given consolidation breakout on daily chart. It has formed a strong bullish candle on daily scale and base is shifting higher. It is trading above all crucial moving averages with momentum indicator RSI giving bullish cross over.
Disclaimer: The views and recommendations provided in this analysis are those of individual analysts or broking companies, not Mint. We strongly advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and individual circumstances may vary.