Stock market today: Trade setup for Nifty 50 to global markets outlook; five stocks to buy or sell on Tuesday — Oct 1

Stock Market Today: Profit booking in index heavyweights such as Reliance Industries and banking counters, coupled with a fall in Japan's Nikkei index, weighed on the Indian stock market on Monday, September 30. The benchmark Nifty 50 index and the S&P BSE Sensex slipped to 25,810.85 and 84,299.78, respectively, down 1.5%. Only the metals pack shone after China’s stimulus news and better-than-expected manufacturing data. Most indices ended in the red, including Bank Nifty, which closed at 52,978.10, with a 1.5% loss.

Trade setup for Tuesday

Nifty tumbled on Monday and formed a long bearish candle. It showed no signs of significant intraday recovery. Nifty has shown signs of trend reversal and could fall soon, said Deepak Jasani, Head of Retail Research at HDFC Securities. Nifty could face resistance from the 25,956-26,011 band while 25,446 could offer support in the near term, said Jasani.

Bank Nifty has eroded some gains from the peak zone of 54,467 levels in the last two sessions, and has near-term support in the 52,300 zone, said Vaishali Parekh, Vice President - Technical Research, Prabhudas Lilladher. A further breach below this level shall weaken the overall bias, with the next major support positioned near 51,300 levels, said Parekh.

Global Markets Outlook

Asian markets had a wild start to the week, with Tokyo's Nikkei 225 index sinking nearly 5 per cent while Chinese markets soared on news of fresh stimulus for the faltering economy. European stock markets retreated Monday, the last day of September, as investors digested a series of local economic releases as well as the differing performances of the major Asian indices.

In the near term, Siddhartha Khemka, Head - Research, Wealth Management, Motilal Oswal Financial Services expects the market to consolidate after witnessing one side move in the last few weeks. Sector-wise the focus could shift towards IT & banking as companies would be releasing their pre-quarterly updates starting this week, Khemka added.

Stocks to buy today

Sumeet Bagadia, Executive Director at Choice Broking has recommended two stock picks for Tuesday. Also, Ganesh Dongre, Senior Manager - Technical Research at Anand Rathi has given another three stock picks for today.

These include Jyothy Labs, Whirlpool Of India, HDFC Life Insurance Company, Reliance Industries and Larsen & Toubro.

Sumeet Bagadia's stocks to buy today

1. Jyothy Labs Ltd- Sumeet Bagadia recommends buying Jyothy Labs at ₹558 with a stop loss of ₹541 and a target price of ₹592.

Jyothy Labs is currently trading at ₹558. It has formed a strong bullish candle on the daily chart, indicating a potential reversal from key support levels. The stock has witnessed a bounce from its support zone, signalling a reversal, backed by an increase in trading volumes, which reflects a bullish outlook. If JYyothy Labs sustains above the critical level of ₹575, it could likely continue its upward momentum towards the target price of ₹592.

2. Whirlpool of India Ltd - Sumeet Bagadia recommends buying Whirlpool of India at ₹2,289.6, keeping a stop loss at ₹2,220 with a target price of ₹2,427.

Whirlpool is trading at ₹2,289.60 and touched its all-time high of ₹2,340.80 on Monday. The stock is witnessing a breakout after a consolidation period and reflects a strong uptrend. It has been forming higher highs and higher lows, indicating a bullish trend. If the stock closes above the key resistance level of ₹2,340, it could see a short-term target of ₹2,427.

Ganesh Dongre's stocks to buy today

3. HDFC Life Insurance Company Ltd- Dongre recommends buying HDFC Life Insurance Company at ₹718 with a stop loss of ₹695 and for a target price of ₹745.

A notable bullish reversal pattern has emerged in the recent short-term trend analysis of the HDFC Life Insurance Company's stock. This technical pattern suggests the possibility of a temporary retracement in the stock price, potentially reaching around ₹745. At present, the stock is maintaining a crucial support level at ₹695. Given the current market price of ₹718, a buying opportunity is emerging. Investors might consider purchasing the stock at its current price, anticipating a rise towards the identified target of ₹735.

4. Reliance Industries Ltd - Dongre recommends buying Reliance Industries at ₹2,960, keeping a stop loss of ₹2,900 for a target price of ₹3,040.

On the daily chart of this stock, support at ₹2,900 level has been observed, signalling a potential upward trend. Complementing this breakout, the Relative Strength Index (RSI) is still turning up, indicating increasing buying momentum. Given these technical indicators, traders can consider buying on dips, and entering the stock at a lower price point. To manage risk, a stop loss of ₹2,900 is recommended. The target price for this strategy is ₹3,040 in the upcoming weeks, suggesting a potential gain as the stock continues its upward trajectory.

5. Larsen & Toubro Ltd - Dongre recommends buying Larsen & Toubro at ₹3,680 with a stop loss of ₹3,600, for a target price of ₹3,950.

On the short-term chart, this stock is forming a bullish engulfing pattern, which is inherently bullish. Currently, priced at ₹3,680, this formation signals a potential upward trend. To effectively manage risk, a stop loss of ₹3,600 is recommended. The target price for this strategy is ₹3,950 in the upcoming weeks. This suggests a potential gain as the stock continues its upward trajectory, backed by the bullish technical signals.

Disclaimer: 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.

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