Two stock recommendations by MarketSmith India:
Buy: Paradeep Phosphates Ltd (current price: ₹225)
Why it’s recommended: Outstanding operational performance in FY25, diverse product portfolio & market reach, strategic infrastructure & logistics, and top-tier ESG credentials
Key metrics: P/E: 22.90, 52-week high: ₹234.39, volume: ₹213.02 crore
Technical analysis: Trending above all its key moving averages with a positive bias
Risk factors: Raw material price volatility and FX exposure, policy & market dependency in a concentrated domestic market, evolving agricultural trends
Buy: ₹225
Target price: ₹255 in two to three months
Stop loss: ₹210
Buy: Waaree Energies Ltd (current price: ₹3,265)
Why it’s recommended: Rapid capacity expansion and backwards integration, robust order book and execution capability
Key metrics: P/E: 39.31; 52-week high: ₹3,743; volume: ₹4,695.11 crore
Technical analysis: downward-sloping trendline breakout
Risk factors: Export trade challenges and US probe risk, intense price competition and supply overhang
Buy at: ₹3,200-3,280
Target price: ₹3,800 in two to three months
Stop loss: ₹3,050
Nifty 50: How the benchmark index performed on 26 August
On Tuesday, Indian equities witnessed a sharp correction, with benchmark indices ending more than 1% lower amid a broad-based sell-off. The Nifty 50 declined 255.7 points, or 1.02%, to close at 24,712.05, while the Sensex shed 849.37 points, or 1.04%, to settle at 80,786.54. The intraday weakness was significant, as the Nifty 50, after opening with a downward gap at 24,899.50, failed to recover and consistently traded in negative territory, and closed near the day’s low.
The market’s negative sentiment was primarily driven by geopolitical and macroeconomic headwinds, including the looming imposition of additional US tariffs on Indian exports and persistent selling by foreign institutional investors (FIIs). On the sectoral front, Nifty Metal, Realty, and Pharma led the decline. The advance-decline ratio was heavily skewed in favour of bears. However, the FMCG sector demonstrated notable resilience, closing with modest gains.
From a technical perspective, the Nifty 50 faced selling pressure after failing to sustain above 24,850 as well as its 21-DMA, indicating weakness in near-term momentum. The relative strength index (RSI) continues to trend lower and currently reads at 46, suggesting a loss of bullish momentum without yet entering oversold territory. Meanwhile, the MACD remains in positive territory but continues to trade below both its signal line and the zero axis.
According to O’Neil’s methodology of market direction, market status has been downgraded to an “Uptrend Under Pressure” as the Nifty breached its “50-DMA” and the “distribution day count” is at three.
The index failed to sustain above 24,850 and is currently trading marginally above its 100-DMA. The overall bias has turned negative, with the next support levels placed at 24,650 and subsequently 24,450. On the upside, immediate resistance is seen at 24,900, followed by the psychological 25,000 level. A sustained move above these resistances would be essential to signal renewed strength and open scope for a meaningful recovery.
How did the Nifty Bank perform yesterday?
On Tuesday, the Nifty Bank opened on a weak note and traded in negative territory throughout the session. The index formed a bearish candle on the daily chart, characterized by a lower-high and lower-low structure. It opened at 54,999.05, touched an intraday high of 55,068.90, and slipped to a low of 54,396.10 before settling at 54,450.45. The persistent selling pressure reflected broad weakness in banking stocks. Notably, all the constituents of the Nifty Bank ended in the red, adding to the bearish sentiment.
The momentum indicator, RSI, has weakened further, slipping toward 33, while the MACD continues to trend below its central line with a sustained negative crossover. According to O’Neil’s methodology of market direction, Bank Nifty is currently classified as being in an “Uptrend Under Pressure”.
In such an environment, investors should adopt a cautious stance—remaining selective, focusing on fundamentally strong and technically resilient stocks, and exercising disciplined risk management, while deploying capital only in high-conviction opportunities.
From a technical standpoint, the index breached its 100-DMA on Friday and has since continued to trade below it, signalling sustained selling pressure. Today’s price action further intensified the downside bias, raising the risk of a deeper correction. If weakness persists, the Nifty Bank could retest its 200-DMA, which lies nearly 3% below current levels. On the flip side, a meaningful recovery and confirmation of bullish momentum would require the index to reclaim and sustain above its 50-DMA near 56,250.
MarketSmith India is a stock research platform and advisory service focused on the Indian stock market. Trade name: William O’Neil India Pvt. Ltd. (Sebi-registered Research Analyst Registration No.: INH000015543)
Investments in securities are subject to market risks. Read all the related documents carefully before investing. Registration granted by Sebi and certification from NISM in no way guarantees performance of the intermediary or provide any assurance of returns to investors.
Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before making any investment decisions.
