Market this week: Analysts expect these stocks to see good traction. Key levels to watch

With receding Covid cases, the market anticipates further easing by the states ahead, analysts said.

Indian equities continued the gaining streak last week as benchmark indices hit fresh record highs. Broader market continued to outperform benchmarks as midcap and smallcap stocks witnessed a strong buying action. The broader indices outshined the benchmark as both Midcap and Smallcap index ended higher by 3.3% and 2.4% respectively. For the week, Nifty and Sensex closed over 1% each.

With receding Covid cases, the market anticipates further easing by the states ahead, analysts said. ‘’We might see a pause in the index initially, after gaining for three successive weeks but the bias would remain on the positive side. In case of any dip, the previous record high zone i.e. 15,400 would act as crucial support in Nifty. On the higher side, we’re eyeing the 15,800-16,000 zone,’’ Ajit Mishra, VP Research. Religare Broking said.

Mishra expects auto, IT and FMCG to see good traction this week. ‘’Most of the sectors are trading in sync with the trend and we feel auto, IT and FMCG may see good traction this week. However, it’s not going to easy to identify the right opportunity at record highs so maintain extra focus on that front and avoid contrarian trades,’’ he said.

Analysts said that only a handful of index heavyweights are giving some notable moves, whereas the real action still continues in the broader end of the spectrum.

Angel Broking’s Chief Analyst-Technical and Derivatives Sameet Chavan’s weekly stock recommendation includes Federal-Mogul Goetze (India) and Grasim.

Explaining the rationale, he said that in last few weeks, a good base building in the Federal-Mogul’s stock was witnessed and the volumes have been extraordinary in the up move from the recent low. ‘’We recommend going long for a short term target of Rs.365. The stop loss can be placed at Rs.307,’’ he said.

Having a bullish view on Grasim, Sumeet Chavan said that the Friday’s upward move led stock prices to its new record highs along with higher than average daily volume. In addition, the ‘RSI-smoothened’ oscillator has crossed the 70 mark, which may provide impetus to the move. ‘’We recommend this stock for a short term price target of Rs.1580. The stop loss needs to be maintained at Rs.1450,’’ he added.

Siddhartha Khemka of Motilal Oswal Financial Services expects Nifty to move upwards to cross the 16,000 level. ‘’The expeditious containment of active COVID-19 cases and accelerated pace of vaccinations would boost and provide confidence in economic growth recovery in FY22E. As states ease restrictions gradually in Jun’21, we expect the demand environment to get better. Technically too, Nifty can see move towards fresh life time high of 16000 zones.’’

After the recent run-up, Nifty now trades at rich valuations. Thus, any negative surprise or misses in the June quarter earnings could act as a dampener, he added.

Get watch our process Click here Ideal Stock Investment , daliy call profit, Market News, Fill Our ask an Expert form