The brokerage says after a lull of more than 24 months, the broader market is on the cusp of the next major bull market. The BSE Midcap and BSE Smallcap indices have corrected 29 per cent and 38 per cent, respectively, from their respective all-time high scaled in January 2018. Benchmark Sensex is down 16 per cent from its lifetime high of 42,273, scaled on January 20 this year.
“The relative ratio of mid and smallcap indices/ Nifty is at a cyclical low, and is turning up, signifying outperformance ahead after a two-year-long bear phase,” the brokerage said, adding that investor sentiment as represented by 14-month RSI (momentum oscillator) at less than 35 is at a major cyclical low, which was last observed in CY08 and CY13. In both instances, such readings laid the foundation of the next major bull market.
On a year-to-date basis, the BSE Midcap index is down 13 per cent and Smallcap index 9 per cent, while Sensex is trading 14 per cent down for the year. On the other hand, the stocks spotted by ICICI Securities have remained resilient during this period.
Rallis India has advanced the most year to date at 60 per cent. It was followed by Deepak Nitrite (up 28 per cent), Balkrishna Industries (up 28 per cent), Trent (up 17 per cent), Bajaj Electricals (up 11 per cent) and Natco Pharma (up 7 per cent).
Agencies
The first half of Calendar 2020 remained highly volatile for stock investors on Dalal Street, as the benchmark equity indices jumped to hit new peaks in January before plunging to new 52-week lows in March and then stage a major rebound from there.
Overall, the start of the year was marked by a lot of uncertainty amid weak macroeconomic data. The spread of the coronavirus pandemic, which led to a nationwide lockdown since March end, only festered the wound. Firm global cues along with monetary and fiscal measures kept the downside capped during this period.
These 15 stocks are flashing 'BUY' signals on tech charts
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Stock Picking
30 Jun, 2020
Domestic markets are moving higher but analysts are still cautious of this move with some saying a correction is imminent given the disconnect between the market and ground reality. Jimeet Modi, CEO, Samco Securities told investors to be cautious, conserve cash and wait on the sidelines. Amid this level of uncertainty, here are 15 stocks that can offer solid returns over the next 3-4 weeks.
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Bata | BUY | Target Price: Rs 1,410
30 Jun, 2020
For the last 49 trading sessions, this counter appears to be moving in a well defined ascending channel with multiple touchpoints. As this counter is trading close to the demand line of the said channel, a bounce can be expected from current levels. As risk-reward ratios from current levels appear to be favourable, positional traders should buy into this counter with a stop below Rs 1,310 on a closing basis and look for a target of Rs 1,410, the analyst said.[Analyst: Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in]
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Ramco Cements | BUY | Target Price: Rs 695
30 Jun, 2020
This counter appears to be consolidating in a zone of Rs 648-595 levels and a strong comeback in last two trading sessions from the lower end of the said consolidation range is hinting that it can be on the verge of a breakout. Considering the current volatility in the markets, positional traders are advised to adopt a two-pronged strategy of buying now and on declines between Rs 610-602 levels, the analyst said. On a sustainable breakout above Rs 650 levels, a target of Rs 695 can be expected. Stop suggested for the trade is a close below Rs 600 levels.[Analyst: Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in]
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Tata Power | BUY | Target Price: Rs 55
30 Jun, 2020
This counter appears to have registered a fresh breakout on lower time frame charts after consolidating in a narrow range for the last five trading sessions. Hence, sustaining above Rs 43, this counter can be expected to head higher towards its next logical target of Rs 55. Hence, positional traders should buy into this counter and look for a target of Rs 55 with a stop below 43 on a closing basis, the analyst said.[Analyst: Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in]
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BEL | BUY | Target Price: Rs 95
30 Jun, 2020
On daily and weekly charts, the stock has formed higher high and higher low series pattern that clearly suggests the stock is in a strong uptrend. On weekly charts, the stock managed to close above Rs 85 with strong bullish continuation candle which is broadly positive. In addition, the strong price volume breakout kind of pattern clearly indicates uptrend likely to continue in the near term, the analyst said. For the breakout, Rs 81 should act as a trend decider level. If the stock manages to trade above the same then we can expect continuation uptrend rally up to Rs 95. Stop-loss suggested for the counter is Rs 81.[Analyst: Shrikant Chouhan, Executive Vice President, Equity Technical Research at Kotak Securities]
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Other analysts are, however, cautious on the market for the rest of the year due to a shaky fiscal situation and rising joblessness. Deepak Jasani, Head of Retail Research at HDFC Securities, said there is fear that stress in the financial sector may sooner or later spread to the real sector of the economy.
