Stock Market News: The domestic benchmark indices, the Sensex and the Nifty 50, began slightly lower on Wednesday, with sentiment remaining negative a day after the government hiked the tax on equities gains.
At 9:15 IST, the Nifty 50 declined 0.14% to 24,444.95, while the Sensex fell 0.11% to 80,343.38.
Now that the sharp increase in STCG taxes and the minor increase in LTCG taxes on equities are a reality, investors should concentrate on making investments in companies that will yield higher returns, according to Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
FMCG stocks are favorable from a value standpoint in the current environment. Watch out for stocks like ITC and United Spirits. It is vital to comprehend that the Budget fortifies the India expansion Story by emphasizing expansion with sound financial management.
Digesting the budget volatility and absorbing the hike in tax rates, Nifty 50 ended flat after a 2% intraday swing in Tuesday’s session. With more than 75% on intraday losses getting absorbed, Nifty 50 is likely to head back to 24,670 / 24,840 on the upside with support now getting trailed to 24,250. Any dips below 24,400 are likely to get bought into for fresh longs. A huge demand came in as soon as Nifty 50 dipped below its 20-day exponential moving average and the same is likely to act as dynamic support as well.
Range on Bank Nifty has shifted lower from 52-53k zone to now 51,000 – 52,550 zone. Bank Nifty has been underperforming Nifty 50 for the past 2 weeks now and the same is likely to continue in this week’s trade. Any rise in the range of 52,000 -52,250 is likely to get sold into for targets of 51,600 / 51,200. Bank Nifty has closed at 1 month low and hence the ongoing underperformance is likely to end only once a close above 52,600 is evidently seen.
A higher high, higher low formation is visible on the daily charts of Max Financial Services Ltd, stock has entered into a tight range for the past 2 weeks which shows a breakout on smaller timeframe charts. Momentum is likely to pick up post 1,050 is taken out on the upside. A follow up of 7-9% can be seen from Tuesday’s close price.
Strong support has been taken at 200 DMA on the stock as the sector continues to remain in momentum. Birlasoft saw a double bottom formation last month and since then has been in a strong upward trajectory. Stock is likely to head to a fresh 4 month high as the follow up is likely to continue on the upside.
Quess Corp has seen a cup and handle breakout on daily charts, with the stock popping out to end its 3 month consolidation phase. With a follow up of this breakout expected to play out this week, this is likely to allow stock lifting to a fresh 2 year high given the pick up in momentum. Expect another 6-8% follow up on this name.
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.
