Stock market on 6 May
The Indian stock market struggled to hold on to early gains on Tuesday as selling pressure weighed heavily on most sectors except for auto stocks. By the close of trading, the Sensex had dropped 155.77 points (0.19%) to settle at 80,641.07, while the Nifty 50 slipped 81.55 points (0.33%) to finish at 24,379.60.
Among Nifty 50 stocks, Adani Enterprises, Eternal, Jio Financial, Trent and SBI Life saw losses, while Hero MotoCorp, Tata Steel, Bharti Airtel, M&M and Hindustan Unilever finished in the green.
Also read: Can M&M keep its pace in FY26?
Sector-wise, PSU banks experienced a drop of nearly 5%, while real estate stocks declined 3.5%. Other segments including pharma, consumer durables, media, oil & gas, and power also recorded losses ranging from 1% to 2.6%.
Overnight, the S&P 500 ended in the red, breaking a nine-day winning streak, the longest in two decades.
Outlook for trading
There remains continued resistance at higher levels owing to geopolitical trends that have kept enthusiasm in check.
From a trading perspective, the cloud support area around 24,180 on the hourly chart that we mentioned yesterday could be a potential zone to watch out for. Combining with the trendline support has helped prices revive.
With a surfeit of small-body candles we now have witnessed a large body candle and a bearish engulfing, clearly hinting at some shorting possibility. Also, from the way the trends have progressed, it’s clear the lack of participation seen now is hinting at a negative divergence. With the market seemingly set for a decline, you should be careful with your positions.
With the market’s inability to close above 24,500, we need to revisit the bullish bias. Momentum on hourly charts indicates prices, after settling down, are now hinting at a further decline. As bullish participants begin to resign, we need to start including some selling candidates in our trading basket.
Also read: Prolonged uncertainty awaits JSW Steel after court quashes BPSL resolution plan
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Options data suggests PCR has moved to 0.77, showing the market continues to face pressure at higher levels. Steady call writing at 24,500 remains a hurdle, fighting buying interest at every rise. Trends remain challenged and we are in a difficult situation.
Three stocks to trade today, recommended by NeoTrader’s Raja Venkatraman
VOLTAS (Cmp ₹1,227.20)
Sell below ₹1,222 and rallies to ₹1,250, stop ₹1,265, target ₹1,125-1,090
- Why it’s recommended: Voltas stock has been weakening due to a combination of factors, including concerns about the company’s engineering, manufacturing, and project services segment, mixed performance in Q3 and Q4, and cautious outlooks from peers such as Havells India. The EMPS segment has faced setbacks such as execution delays, cost escalations and legal disputes, impacting profitability.
- Key metrics
- P/E: 59
- 52-week high: ₹1946.20
- Volume: 1.2M
- Technical analysis: Support at ₹1,100, resistance at ₹1,325
- Risk factors:High volatility, negative investor sentiment and long-term bearish trends.
- Sell at: CMP and rally to ₹1,250
- Target price: ₹1,125-1,090 in one month.
- Stop loss: ₹1,265
JSW ENERGY (Cmp ₹466)
Sell at CMP and rallies to ₹481, stop ₹490, target ₹440-425
- Why it’s recommended: JSW Energy’s stock price decline can be attributed to a combination of factors, including a drop in profit after tax, a decline in revenue, and a bearish trend indicated by trading below moving averages. These factors, coupled with mixed market sentiment, have contributed to a broader negative outlook for the stock.
- Key metrics:
- P/E: 15.66
- 52-week high: ₹213
- Volume: 4.89M
- Technical analysis: Support at ₹431, resistance at ₹610
- Risk factors: Market fluctuations, regulatory changes, and sector-specific challenges in the power distribution industry.
- Sell at: CMP and rally to ₹481
- Target price: ₹440-425 in one month
- Stop loss: ₹490
KEI Industries Ltd (Cmp ₹3,193.90)
Buy above ₹3,210 and dips to ₹3,150, stop ₹3,130 target ₹3,330-3,450
- Why it’s recommended: Goldman Sachs recently upgraded KEI Industries to a ‘buy’, marking the first time it has taken a bullish stance on the stock since initiating coverage in November 2023. Also, the charts indicate the formation of a V-shaped recovery.
- Key metrics:
- P/E: 45.39
- 52-week high: ₹5040
- Volume: 1.03M
- Technical analysis: Support at ₹2,800, resistance at ₹3,400
- Risk factors: Raw material volatility and competition from domestic players could impact profitability.
- Buy at: CMP and dips to ₹3,150.
- Target price: ₹3,330-3,450 in one month
- Stop loss: ₹3,130
Also read: Treasury gains save SBI’s day, but couldn’t avert earnings downgrades
Raja Venkatraman is co-founder, NeoTrader. His Sebi-registered research analyst registration no. is INH000016223.
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.
