How are you reading into the market?
Aditya Arora: Look, the trend today is pretty encouraging and in line with what happened in the US market on Friday wherein S&P 500 had made new 52-week high. So, we are following the global trend. All is good. The music is good right now. But I would be pretty cautious around 25,500 where the option writers are pretty active. Call writers are active. And the important thing to notice is that the kind of fall which we had seen from 26,400 in Nifty futures to 25,000, it was one of the swiftest fall and continuous back-to-back red candle, which we have seen in last few weeks and few months. So, around 25,500, I want to see how the buyers are reacting, how the sellers are reacting. And my bias is little bit on the downside. I think that could be a good time to take chips off the table, book profit and wait for the lower price to get in the market. So, that is my overall view on Nifty overall.
And how is the banking index looking like? Also, HDFC Bank is perking up in trade. It is up around 2 odd percent. Any signs of reversal here?
Aditya Arora: The trend is positive right now. We have taken out yesterday’s high, so that is positive. But again, over here, if there is a retracement around 52,500 to 53,500, that is an important Fibonacci level and important resistance for Bank Nifty. Over here, bulls could be little cautious and they may get opportunity at lower levels. If I had to talk about the lower levels in both the indices, then I am expecting 49,000 to 50,000 in next one month on Bank Nifty and 24,000 on Nifty.
But what are the individual recommendations today?
Aditya Arora: So, I like FMCG basket. I think FMCG basket has been a consistent performer. Even in times of volatility and uncertainty, this sector outperforms. So, one candidate which I like is ITC. It is a buy at 496 and stop loss must be maintained at 485, target is 505 to 515, that is the first one and the second one is Hindustan Unilever. Again, this stock is coming out of a very long consolidation and underperformance.
So, I believe this is just the start of an outperforming period. So, this is a buy at 2802.50, stop loss is 2750, and target is 2850 to 2900.
But since you are talking about FMCG, would this dip be a buying opportunity on Avenue Supermarts and what about BSE, that one is just flying away.
Aditya Arora: I think Avenue Supermarts had a very super normal correction from 5,500 to almost 4,200. Yes, I would look to accumulate this counter. Although I consider this as an underperformer given the recent fall, but yes, with the sector as the outlook for the sector is positive, this can stabilise somewhere around 4,300, 4,400 and there the upside journey could start.
And second one, BSE, it is a runaway rally. I think it is one of the climatic rally, parabolic rally which we have seen.
So, I would be a little cautious over here because it is also riding the wave of NSE listing which is just around the corner.
Once the NSE issue is being listed, I think underperformance can creep in this counter. So, these are the times to actually book handsome profit.