Broader market performance was mixed, while a drop in India VIX pointed to easing intraday volatility.
Two stocks recommended by MarketSmith India for 3 July:
Buy: Sagility India Ltd (current price: ₹43.72)
- Why it’s recommended: Robust earnings and profitability, leader in the U.S. healthcare BPM
- Key metrics: P/E: 37.28, 52-week high: ₹ 56.40, volume: ₹ 706.92 crore
- Technical analysis: Reclaimed 100-DMA on above average volume
- Risk factors: High client concentration and U.S. market dependency, governance and execution exposures
- Buy at: ₹ 43.72
- Target price: ₹ 49 in two to three months
- Stop loss: ₹ 41
Buy: Sai Life Sciences Ltd (current price: ₹789)
- Why it’s recommended: Strong presence in CRAMS segment, global client base and repeat business
- Key metrics: P/E:184.18, 52-week high: ₹ 838, volume: ₹648.76crore
- Technical analysis: Consolidation base breakout
- Risk factors: Customer concentration risk, margin pressure from competition
- Buy at: ₹ 420
- Target price: ₹ 920 in two to three months
- Stop loss: ₹ 740
Nifty 50’s performance on 2 July
On Wednesday, the Nifty 50 declined 88.40 points, or 0.35%, to settle at 25,453.40. After a muted start, persistent selling in heavyweight stocks dragged the index below 25,400 during intraday trade. A modest recovery in the second half of the session helped limit the losses by the close.
Among sectoral indices, Metals led the gains with an advance of over 1.4%, followed by Auto. On the flip side, Realty continued to underperform, falling more than 1.4%. The Banking pack also remained under pressure, with the Bank Nifty and PSU Bank indices shedding 0.80% and 0.83%, respectively. In the broader markets, midcaps outperformed, while smallcaps moved largely in line with the benchmark. Market breadth was negative, with the advance-decline ratio skewed in favour of the bears at 1:2.
Despite the day’s decline, the Nifty 50 continues to maintain a bullish structure, trading above all its key moving averages across timeframes—reinforcing the prevailing uptrend. However, with Wednesday’s breach below the recent narrow consolidation range, momentum appears to be waning.
Among key indicators, the Relative Strength Index (RSI) is trending lower and currently hovers around 61 on the daily chart, suggesting signs of profit-taking. The daily MACD, however, remains in positive territory, indicating the broader trend still favours the bulls.
According to O’Neil’s methodology of market direction, the Nifty reclaimed its recent high of 25,116, and as of 11 June 2024, the market status remains in a confirmed uptrend.
With the index closing below the lower end of its recent three-day range at 25,500, emerging weakness is evident. If the Nifty fails to reclaim and sustain above 25,500, it could invite further profit booking, potentially dragging the index down to 25,200—with stronger support seen around 25,000. Conversely, a sustained move above 25,500 could pave the way toward 25,800, with a possible extension up to 26,000.
Nifty Bank’s performance on 2 July
The Nifty Bank index declined by around 0.80% on Wednesday in a choppy, range-bound session. Despite the intraday weakness, the index continues to uphold its broader bullish momentum, as it remains firmly positioned above all its key moving averages—a sign of sustained trend strength.
The index opened at 57,558.20, moved within a range of 57,628.40 (high) to 56,833.80 (low), and closed at 56,999.20.
On the daily chart, the Relative Strength Index (RSI) declined to 60 from 66 in the previous session, indicating some moderation in momentum. However, the MACD continues to show a positive crossover, suggesting underlying strength remains intact.
According to O’Neil’s methodology of market direction, Bank Nifty remains in a Confirmed Uptrend—a trend it has sustained for the past few weeks.
The overall sentiment in the banking sector remains decisively bullish. The near-term outlook stays positive, with a sustained hold above the 57,000 mark likely to reinforce upward momentum and potentially propel the index toward the 58,500–59,000 range in the coming sessions. On the downside, immediate support is seen around 56,500, with a stronger cushion near 56,000 expected to limit short-term pullbacks.
MarketSmith India is a stock research platform and advisory service focused on the Indian stock market. It offers tools and resources to help investors make informed decisions based on the CAN SLIM methodology, developed by legendary investor William J. O’Neil. You can access a 10-day free trial by registering on its website.
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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.
