On October 18, 2024, Chandan Taparia, Head of Equity Derivatives and Technicals at Motilal Oswal Financial Services Ltd. (MOFSL), has identified three stocks that investors should consider buying amidst a challenging market environment. The recommended stocks are HCL Technologies, National Aluminium Co., and Hindustan Petroleum Corporation Ltd. As the Indian stock market faces significant selling pressure, understanding these recommendations is crucial for making informed investment decisions.
Market Context: Navigating Through Turbulence
The Indian stock market has been under heavy selling pressure recently, influenced by escalating geopolitical tensions in the Middle East, a spike in crude oil prices, weak domestic corporate earnings, and persistent outflows of foreign funds from Indian equities. On Thursday, both the BSE Sensex and Nifty 50 indices closed lower for the third consecutive session. The Sensex fell by 494.75 points (0.61%) to finish at 81,006.61, while the Nifty 50 dropped 221.45 points (0.89%) to settle at 24,749.85.The domestic equity market is expected to open lower on Friday amid mixed global cues. The trends on the Gift Nifty indicate a gap-down start for the Indian benchmark index, trading around the 24,740 level—a discount of nearly 100 points from the previous close of Nifty futures.
Recommended Stocks: A Closer Look
Chandan Taparia has provided specific entry points and insights for each of his recommended stocks:
- HCL Technologies: As a leading player in the IT sector, HCL Technologies has shown resilience even in turbulent times. Taparia recommends buying shares at current levels with an optimistic outlook based on the company’s strong fundamentals and growth prospects.
- National Aluminium Co. (NALCO): With rising demand for aluminum in various sectors including construction and automotive, NALCO stands to benefit significantly. Taparia’s recommendation comes as a timely opportunity to invest in a company poised for growth amid increasing infrastructure spending.
- Hindustan Petroleum Corporation Ltd (HPCL): As one of India’s major oil refining and marketing companies, HPCL is well-positioned to capitalize on any recovery in crude oil prices. Taparia’s recommendation reflects confidence in HPCL’s operational efficiency and potential for profit growth as market conditions stabilize.
Technical Analysis: What Lies Ahead?
According to Taparia’s analysis, the Nifty 50 index has broken below critical support levels and formed a bearish candle on the daily chart. He noted that as long as the index holds below 24,850, weakness could extend towards 24,650 and even 24,500 zones. Conversely, resistance levels are positioned at 24,850 and then at 25,000.On the options front, maximum call open interest is observed at the 25,000 and 26,000 strikes while maximum put open interest is seen at 23,500 and 24,000 strikes. This data suggests a broader trading range between 24,300 to 25,300, with an immediate range between 24,500 to 25,000.
Conclusion: A Strategic Approach
In conclusion, Chandan Taparia’s recommendations for HCL Technologies, National Aluminium Co., and Hindustan Petroleum Corporation Ltd offer investors actionable insights amid challenging market conditions. While the overall sentiment remains cautious due to external factors impacting market performance, these stocks may present opportunities for those willing to engage strategically.Investors should remain vigilant and conduct their own research or consult with financial advisors before making any decisions based on expert recommendations.Disclaimer: The views expressed in this article are those of individual analysts or broking companies and do not represent the views of any financial institution. Investors should consult certified experts before making investment decisions as market conditions can change rapidly and individual circumstances may vary.
