Buy or sell stocks: The Indian stock market extended its selling for the second straight session on Friday. The Nifty 50 index broke below the 50-DEMA support and finished nearly 400 points lower from the weekly high at 24,837. This marks Nifty’s fourth consecutive week of losses, with a weekly decline of 0.53%. Cipla, SBI Life, and Apollo Hospitals demonstrated strength in a broadly negative market, standing out as the Nifty’s top performers on Friday. Conversely, it was a tough session for financial heavyweights, with Bajaj Finance, Shriram Finance, and IndusInd Bank ending as the major losers. Trading volumes on the NSE cash market were lower by 4% compared to yesterday.
Baring, Nifty Pharma and Healthcare, and all other sectoral indices ended in red. Nifty Media, PSU Banks, Oil & Gas, and Metal fell sharply, registering the steepest declines and bearing the brunt of the selling pressure. The pain was even more acute in the broader market today, with the Nifty Midcap 100 and Smallcap 100 indices significantly underperforming the benchmark. The Nifty Midcap 100 Index plunged 1.61%, while the Nifty Smallcap 100 Index plummeted 2.10%. Market breadth remained weak for the seventh day, where declining shares surpassed advancers. The advance-decline ratio on the BSE stood at 0.40, the lowest since 19 June.
Stock market next week
Sumeet Bagadia, Executive Director at Choice Broking, believes the Indian stock market bias has weakened as the Nifty 50 index has decisively broken below the 50-DEMA support of 24,900. The Choice Broking expert said the key benchmark index may try to touch 24,700 to 24,650 levels in the subsequent few sessions. However, the crucial support for the 50-stock index is now placed at 24,500, whereas the index faces a hurdle of 25,050. He advised investors to maintain a stock-specific approach and look at those stocks that look strong on the technical chart.
Sumeet Bagadia’s stock picks
Regarding stocks to buy next week, Sumeet Bagadia recommended buying these three technically strong stocks: Sun Pharmaceutical Industries, HDFC Life Insurance Company, and Jindal Steel And Power.
1] Sun Pharma: Buy at ₹1699, Target ₹1850, Stop Loss ₹1620.
Sun Pharma’s share trades at ₹1,699 and maintains its overall uptrend, forming a consistent pattern of higher highs and lows. After recently reaching a record high, the stock has retraced toward its demand zone and is currently consolidating within a well-defined range. This consolidation phase appears constructive, supported by steady accumulation and consistent trading volumes, indicating growing buying interest at lower levels.
The ongoing consolidation near key support zones sets the stage for a potential reversal. A sustained move above the ₹1,730 mark could act as a strong confirmation of this reversal and may open the door for a renewed upward trajectory. Such a breakout would end the current range-bound price action and reinforce the continuation of the broader uptrend.
Given the encouraging chart setup, improving momentum, and volume-backed accumulation near demand zones, traders may consider buying Sun Pharma shares at ₹1,699, with a stop-loss at ₹1,620 to manage downside risk. A breakout and sustained move above ₹1,730 could pave the way for an upside toward ₹1,850 in the short to medium term, offering a favourable risk-reward opportunity for positional traders.
2] HDFC Life: Buy at ₹762.35, Target ₹825, Stop Loss ₹730.
HDFC Life’s share price is currently trading at ₹762.35 and remains in a broad uptrend, marked by a consistent formation of higher highs and higher lows on the higher timeframes over the past several months. After hitting a record high recently, the stock has undergone a healthy retracement, moving toward its demand zones, which has helped constructively reset the momentum.
The stock shows signs of a potential reversal from these demand zones, supported by a stabilising price structure and renewed buying interest. A sustained move above the ₹775 mark could act as a breakout trigger and pave the way for the stock to resume its upward momentum, potentially revisiting its previous highs and extending beyond them in the near term.
Considering the positive long-term structure, early signs of reversal, and momentum recovery, traders may look to buy HDFC Life shares at the current market price of ₹762.35, with a stop-loss placed at ₹730 to limit downside risk. A breakout and sustained move above ₹775 could unlock upside potential toward ₹825, offering an attractive setup for positional traders.
3] Jindal Steel And Power: Buy at ₹1000, Target ₹1090, Stop Loss ₹955.
Jindal Steel’s share price closed the day at ₹1,000.15, showcasing a strong technical breakout that signals the beginning of a potential uptrend. The stock recently completed the formation of a classic Inverted Head & Shoulders pattern, which is widely recognised as a bullish reversal structure, typically marking the end of a prior downtrend. The breakout above the neckline resistance at ₹980, backed by rising volumes, indicates a confirmed trend reversal with growing bullish momentum.
The stock is now trading well above all its key exponential moving averages across short-term, medium-term, and long-term timeframes, reinforcing the strength of the ongoing upward trend. This alignment of moving averages adds credibility to the breakout and supports the case for continued bullish action.
Momentum indicators are also in sync with the price structure. The Relative Strength Index (RSI) is in the bullish zone, reflecting strong buying interest, while the MACD is likely showing a positive crossover, supporting the ongoing trend. Additionally, the price is riding the upper Bollinger Band, a classic signal of trend strength and a potential sign of sustained momentum.
Given the breakout structure, rising volumes, and momentum confirmation, traders may consider buying JINDALSTEL at the current market price of ₹1,000.15, with a stop-loss at ₹955 to manage downside risk. A sustained move above ₹1,000 could lead to further upside toward ₹1,090 in the short to medium term, offering a favourable setup for traders and investors.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before making any investment decisions.