The Nifty50 crawled back to 10,000 for the first time since October 2017 but there were plenty of stocks which outperformed the index in the same period. The index has plunged over 10 percent from its 2018 high of 11171 but it is still in a bull run, suggest experts.
The index came under pressure this week following a rate hike by the US Federal Reserve and after US President Donald Trump signed a presidential memorandum that could impose tariffs on up to USD 60 billion of imports from China. This ignited fears of a possible trade war across the globe.
“As negative sentiments in global markets are strengthening day by day a close below 10,000 may extend this downswing towards bigger targets of 9700 levels as of now,” Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in told Moneycontrol.
“As our technical research conclusions on long-term trends are suggesting that this is a multi-month correction inside a long-term bull market and in this correction, as indices are already down by 10% it should be made use by the long-term investors as an opportunity to create or reshuffle their portfolios,” he said.
Other stocks which rose over 50 percent include names like L&T Technology Services, Jubilant FoodWorks, Biocon, MindTree, IFB industries, Biocon, TV18 Broadcast, and NIIT Technologies.
In the Nifty50 pack stocks which hogged the limelight include names like IT, realty, FMCG, Infrastructure while Nifty pharma plunged 10% followed by PSU Banks which dropped 7.4 percent in the same period.
Among the Nifty50 names, stocks like Tech Mahindra rallied 32 percent, followed by Infosys which gained 24 percent, L&T was up 14 percent, and Maruti Suzuki, as well as M&M, were up 10-11 percent respectively.
Among the losers in the Nifty50, Lupin dropped 27 percent, followed by HPCL which fell 24 percent, Aurobindo Pharma was down 23 percent, and Tata Motors dropped 18 percent in the same period.
The Nifty50 which is down over 10 percent from the highs is up a little over 1 percent from October 2017. Most analysts’ experts feel that the index should be able to form a base around 10K.
Shubham Agarwal, CEO at Quantsapp
“Nifty has been in a downtrend for a couple of months and we continue with our initial target of 9700 on Nifty where studies will need to be reviewed. The level of 10000 was important due to the fact of highest Put OI existing around that, the level holds firm only if OI shifts doesn’t happen which is not the case since market opening today,” Shubham Agarwal, CEO at Quantsapp told Moneycontrol.
“Though, we still have a target of 9700 due for Nifty, taking a fresh sell position on futures now may not be favourable with diminishing reward to risk. A better strategy would be to buy naked Put options with a short-term perspective. This will keep the risk limited and reward open,” he said.moneycontrol