Jayant Manglik
The market ended the last week with modest gains amid volatility, thanks to favourable local cues and supportive global markets. Selective buying in the index majors pushed the benchmark index above 11,700 for the first time.
With no major event on the local front, markets are currently dancing to the global tunes. The overall situation on the broader front is still faint as the recent participation is limited only to select midcap and small-cap counters and any fall in the benchmark index would further worsen the condition.
The Nifty has started the week with strong up move and surpassed our immediate target of 11,650. But, it looks a bit stretched now and thus we suggest reducing positions on every rise from hereon and focusing on select stocks.
Volatility would also be hard to handle due to scheduled derivatives expiry on Thursday. In short, traders should prepare themselves for an eventful week and keep a close eye on global developments along with the domestic factors.
We prefer private banks, auto and pharma counters for long trades.
Here is a list of top three stocks which could give 6-8% returns in the next 1 month:
Sun Pharmaceutical Industries Limited: Buy | Target: Rs 670 | Stop-Loss: Rs 590| Return 8.06%
Post the breakout from its year-long consolidation phase this month, Sun Pharma has retraced marginally, offering fresh buying opportunity to those who had missed the chance earlier.
The chart formation combined with an indication from pharma index is clearly pointing towards strong surge ahead. Traders should use this dip to accumulate fresh longs in the range of Rs 615-620. It closed at Rs 621.80 on August 27, 2018.
MindTree Limited: Buy | Target: Rs 1110| Stop-Loss: Rs 1015 | Return 5.71%
MindTree is one of the strongest counters in IT space. After making a record high at Rs 1101.20 in May 2018, it has been consolidating in a broader range for the last three months or so while holding firmly above the support zone of 100-EMA on the daily chart.
Currently, it’s trading on the verge of a breakout from the same. We advise creating fresh longs in the range of Rs 1,040-1050. It closed at Rs 1050.05 on August 20, 2018
Indiabulls Housing Finance Limited: Buy| Target: Rs 1380 | Stop-Loss: Rs 1240 |Return 6.97%
Indiabulls Housing Finance has retraced marginally of late after retesting its record high and found support around the short-term moving averages (50/100) EMA on the daily chart.
We believe it is an excellent buying opportunity, considering the overall chart structure and positioning of confirmation indicators. Traders can accumulate within 1280-1290. It closed at 1283.45 on August 27, 2018.
Disclaimer: The author is President, Religare Broking. The views and investment tips expressed by investment expert on moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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