Nifty looks weak
Last week, the Nifty lost more than 500 points and closed at 10316. Below 10460, the market is weak and can test 10200-10150 levels. The weekly candle of Nifty is making a ‘lower high and lower low’ formation, which indicates more downfall from the current level. The markets may stabilize around 10200-10150 levels, where fresh buying will be seen. Hence, wait for the Nifty to hit 10200 to accumulate quality stocks like Yes Bank, Reliance Industries, HDFC Bank, Jubilant Foodworks, etc. for the long term. Accumulate fundamentally strong stocks in small lots and on dips to build a good portfolio.
The global sentiment is also weak. Crude oil prices are on the rise. The rupee has breached the 74 mark against the US dollar. Rising petrol and diesel prices will lead to higher inflation, which will have a huge impact on the Indian economy. The government’s decision to reduce excise duty on petrol and diesel has affected petroleum companies like BPCL, HPCL and IOC, which corrected 10-15% in two days last week. The RBI kept repo rate unchanged at 6.5% in its policy meet held on Friday, 5 October 2018. However, citing risks from trade wars, the MPC changed its stance from ‘Neutral’ to ‘Calibrated Tightening’. Thus, there are no positive triggers left in the market. So, trade cautiously and take light positions.
Bank of Baroda is a ‘sell’ below Rs.100 for a target of Rs.95-90 (SL: Rs.105.50)
ICICI Bank is a ‘sell’ below Rs.310 for a target of Rs.305-300 (SL: Rs.315.50) Infosys is a ‘buy’ above Rs.718 for a target of Rs.730-735 (SL: Rs.710)