Stocks to buy for short-term: Jay Thakkar of ICICI Securities recommends these three shares to buy today

Stock Market News: The main stock market indices, Nifty 50 and Sensex, saw a slight increase on Wednesday’s early trade as investors cautiously returned following a significant drop in the prior session that brought the index down to a seven-month low. Despite showing some gains, the indices fell into negative territory for a period and remained relatively flatish post noon.

As of 12:28 IST, the Nifty 50 was flat at 23,012.80 level, while the Sensex too was flat at 75,939.12. On Tuesday, both indexes fell approximately 1.5% due to concerns regarding Donald Trump’s intentions for India after the US President imposed trade tariffs on neighboring countries just hours after taking office.

The indexes dropped approximately 1.5% on Tuesday amid uncertainty regarding Donald Trump’s intentions for India following the U.S. President’s announcement of trade tariffs on neighboring nations within hours of assuming office.

Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, remarked that President Trump’s actions and statements thus far have been disruptive. He seems to be using tough rhetoric initially to convey that more stringent measures could follow. Trump’s warning of imposing 100% tariffs on BRICS nations if they pursue dedollarization echoes the rhetoric he used during his election campaign. It seems that the markets have reacted seriously to this threat.

Market Outlook by Jay Thakkar, Vice President & Head of Derivatives and Quant Research, ICICI Securities

Nifty 50

Technically, the Index has been forming lower tops and lower bottoms and with that the trend is still down. The momentum indicator MACD is in sell mode at all the degrees from daily to monthly. The Nifty 50 has also provided the death crossover wherein the 50DMA has crossed the 200 DMA from the top.

Recently, it had taken a support near 23,000 and bounced back until 23,400 levels, however, the recovery was not well supported by the momentum and it resulted in the formation of a corrective up move which formed a bearish rising channel. The rising channel was broken in yesterday’s session, hence the outlook for the short term still remains down with a reversal pegged at 23,300 on the upside as that is the near-term swing on the hourly charts. On the lower side, 22,800 is an immediate support as well as the target and below that 22,500, so until Nifty 50 doesn’t take off 23,300 levels on the upside, the downside targets are 22,800 to 22,500 levels.

From the derivatives perspective, the weekly PCR is at 0.76 which is bearish, however, 23,000 still has highest put OI, hence that is the crucial support and till those levels are held the probability of a bounce back still remains, however, below 23,000 levels the downside momentum will increase. The max pain is at 23,150 and that is the short-term hurdle for the Index. The FII net long % has dipped to almost 17% and that looks little oversold and that could trigger a bounce back from hereon.

Stocks To Buy in the near-term – Jay Thakkar

Jay Thakkar of ICICI Securities recommends buying Hero MotoCorp Ltd, JSW Steel Ltd, and Navin Fluorine International Ltd.

Buy Hero MotoCorp Ltd at Cmp: ₹4,058; Stop loss: ₹3,990 Target: ₹4,400 and ₹4,600

Hero MotoCorp has shown second positive divergence on the daily charts and the prices have stopped forming lower lows despite sell off in the overall markets indicates that there is a higher probability of an upside i.e. a bounce back from hereon. The overall shorts are also quite high in the stock, indicating that the short covering move can be witnessed in the stock as it has now taken a pause in the downside. There has been put writing from 3950 to 4050 levels which can act as a support and there has been call unwinding at higher levels from 4100 to 4300 strikes indicating the market participants anticipating a bounce back in the stock.

Buy JSW Steel Ltd at CMP: ₹924; Stop Loss: ₹904; Targets: ₹955 and ₹970

Technically, the JSW Steel has started to form higher tops and higher bottoms on the daily charts with a bullish crossover on the daily MACD. The Nifty Metal Index seems to be outperforming the Benchmark Index indicating an early sign of a recovery. Looking at the derivatives data too, the PCR is near to 1 i.e. neutral and there have been solid out additions at 900 levels indicating that to be a string support and till those levels are held the overall chances of stock to move up is quite higher. The stock is also trading above its max pain level of 920 which is another bullish signal in the near term.

Buy Navin Fluorine International Ltd at Cmp: ₹3,704; Stop loss: ₹3,600; Targets: ₹3,900 and ₹4,000

Technically, the Navin Fluorine has provided a breakout from the sideways channel and it seems to be retesting the same. The momentum indicator MACD has turned bullish on the daily as well as weekly charts indicating a strong upside momentum. The stock has also outperformed the benchmark index in the recent fall showing positive relative strength. The derivatives data too suggest that there are high put writers at the lower level at 3600, so that is a strong support whereas 3800 has the highest call OI so that is the near-term resistance. The stock is trading above the max pain level of 3700 which is also a positive sign in the near term.

Disclaimer: The Research Analyst or his relatives or I-Sec do not have actual/beneficial ownership of 1% or more securities of the subject company, at the end of 21/01/2025 or have no other financial interest and do not have any material conflict of interest.

The views and recommendations provided in this analysis are those of individual analysts or broking companies, not Mint. We strongly advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and individual circumstances may vary.