Stock in focus: Rajesh Palviya of Axis Securities recommends Vedanta, NBCC, Federal Bank, and Biocon today

Stock Market News: Domestic equity benchmark indices, the Sensex and the Nifty 50, began Friday's session with modest gains amid mixed global cues. Following Accenture's optimistic revenue projection, information technology (IT) stocks rose. 

Nifty IT increased by 2% as a US-based industry bellwether predicted higher-than-expected full-year sales growth. Given that rising interest rates have caused clients to reduce spending, the results provide Indian IT businesses with insights on demand in the US market.

Early trading saw Sensex rise 329.52 points to 77,808.45, while Nifty 50 gained 100.1 points to reach a record high of 23,667.10.

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According to Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, the market is now going through a phase of consolidation, and this is probably going to continue. Aggressive purchasing or selling is not triggered by any significant factors. The market has a positive undertone even during this time of consolidation, therefore purchasing on dips will emerge and strengthen the market. Strong up movements will cause profit booking, making a long-term rally challenging.

Share Market Tips and Nifty 50 Outlook by Rajesh Palviya, SVP - Technical and Derivatives Research, Axis Securities

The benchmark index is in a strong uptrend forming a series of higher tops and bottoms. Currently, the index is well placed above its 20, 50 and 100-day SMA which reconfirms a bullish trend. We expect this momentum to extend towards 23,800-24,000 levels in upcoming weeks. The crucial support zone to watch for is 23,400 levels hence any violation of the same may cause some profit booking towards 23,000-22,800 levels. The daily and weekly strength indicator RSI is in positive terrain which shows sustained strength, said Rajesh Palviya, SVP, Technical and Derivatives Research, Axis Securities.

Also Read: Nifty 50 Share Price Live Updates: Nifty 50 is trading at ₹23620.2

Nifty 50 in the current series has witnessed Long Addition with a price gain of 4.28% (969 points) and an increase in open interest by 7%. As per options data of the monthly expiry scheduled on 27th June 24,000 and 23,800 Call strikes have high OI concentration indicating a strong resistance; while on the Put side, high open interest concentration was in 23,000, and 23,300 acting as support while the pivotal level will be 23,500, explained Palviya.

Stock in focus today - Stock recommendation for Friday by Rajesh Palviya

NBCC (India) Ltd (CMP: ₹164)

Currently, the stock is well placed above its prior breakout zone of 155 levis. huge rising volumes signify increased participation in the rally. Prices are placed above its 20, 50 and 100 SAM which reconfirms bullish sentiments. In the past couple of weeks, the prices have captured a 30-week SMA (117) and rebounded sharply. The daily "band bollinger" buy signal shows increased momentum.

“Investors should buy, hold and accumulate this stock with an expected upside of 178-190 with a downside support zone of 155-150 levels,” said Rajesh. 

Vedanta Ltd (CMP: ₹471)

With today's price gain of 5%, the stock has decisively broken out the past couple of weeks' "multiple resistance" zone of 465 levels on a closing basis. This breakout is accompanied by huge volumes indicating bullish sentiments. The prices have also recaptured 20-day SMA (450) which remains a crucial support zone.

“Investors should buy, hold and accumulate this stock with an expected upside of 500-530 with a downside support zone of 449-440 levels,” explained Palviya.

Also Read: From TCS to Infosys, IT stocks in focus after Accenture's Q3 results

Federal Bank (CMP: ₹179)

On the weekly chart, the stock has decisively broken out the past five weeks' "multiple resistance zone " of 168 levels on a closing basis indicating positive bias. Huge volumes on rallies justify increased participation. The daily and weekly strength indicator RSI is in positive terrain which shows rising strength.

“Investors should buy, hold, and accumulate this stock with an expected upside of 200-220 with a downside support zone of 175-172,”said Rajesh.

Federal Bank today has seen a price gain of 4.05% in current expiry and an increase in open interest by 23% (as per provisional data in the next series) indicating a Strong Long build-up. In the June series, there has been a high OI concentration at 185 call strike followed by 190 indicating a probable resistance zone, while strong support is seen at 175 & 170 levels as significant OI concentration on the Put side has been seen. Writing in 175 & 177 PUT strike further augments positive view on the stock.

Also Read: Stock market today: Trade setup for Nifty 50, five stocks to buy or sell on Friday - June 21

Biocon Ltd (CMP: ₹343)

On a daily and weekly basis, after a decisive breakout, the stock has continued its uptrend and is headed towards the “important resistance" zone of 190-192 levels, which is likely to act as strong resistance with a high probability of profit booking. Stock is well placed above its 20, 50, 100, and 200-day Simple Moving Averages (SMA), reaffirming a bullish trend. The daily and weekly strength indicator RSI reading above 60 indicates a continuation of an uptrend with rising strength. 

“Investors should buy, hold, and accumulate this stock with an expected upside of 190-195 with a downside support zone of 170 levels. Investors should buy, hold and accumulate this stock with an expected upside of 360-385 with a downside support zone of 328-320 levels,” advised Palviya.

Biocon has witnessed a Long Build-Up with price gains of 3% (10 points) and an increase in open interest of 24% (as per today’s provisional data for the next series). In the June series, high OI has been seen at 360 call strike followed by 350 indicating a probable resistance zone, while support is seen at 330 & 320.

Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decision.