The Indian market continued its downward trend and closed with a decline of about half a percent on Wednesday. This is the fourth season in a row when the benchmarks have closed in red. Several factors contributed to Wednesday’s fall, including the long-awaited CPI and IIP data this week, profit booking and FII sales. IT, auto and FMCG stocks rallied in the last session along with selling pressure. Small caps were the biggest hit on Wednesday as the Nifty’s small cap fell nearly 3% in the broader market
Indicators before CPI and IIP data this week showed extreme volatility today, said S Ranganathan, head of research at LKP Securities.
“Although we saw a sharp recovery in the indices during the afternoon trade, the market width was very weak and several stocks in the broader market took a big knock-on selling pressure as the small-cap index lost 3% today,” he said.
Meanwhile, certain stocks came into focus due to their large movements on both sides. These stocks are SRF Ltd, PB Fintech (policy market) and Gujarat Gas. On Wednesday, shares of SRF ended with gains of about 6%, policy market more than 3% and Gujarat Gas rose 6% although benchmarks fell about half a percent.
That is, Santosh Meena, head of research at Swastika Investmart Ltd, talks about the stocks and recommends a level of caution for investors when the market resumes trading on Thursday.
SRF: The stock is in a classical uptrend and is in the pattern of trading upward sloping channel formation. The overall structure is bullish as it ranges from around 252-SMA to Rs. 2100. On the contrary, Rs 2300 is an immediately sensitive area; On top of that, we can expect to move towards 2500+ in the near term when 2100 is an immediate support level.
Policy Market: The counter is on a downward trend but in the last trading session, the scrip made a clever recovery from the 540 level. The overall structure is distorted and it also trades below its all-important moving average, however, it has a demand zone around 540. On the contrary, Rs. 625 an immediately sensitive area; On top of that, we can expect a run up towards Rs. 700 at close range.
Goosebumps: The counter is coming out of a long aggregation with strong volume. The pattern suggests an immediate target of Rs 600, where it is likely to be further reversed. On the negative side, Rs. 480 will act as an immediate support level. RSI (Relative Strength Index) and MACD (Moving Average Convergence Divergence) are supporting the current strength.