What to Trade on Indian Markets For 21st May 2019?

As expected, the Indian market gained sharply on Monday as exit polls signals NDA coming back to power with a strong majority. The bank NIFTY index posted fresh historic high along with NIFTY index yesterday. The local sentiment remains strong despite global headwinds where the US down Jones index dropped overnight tracking weak economic data and also fears of China withdrawing talks on trade discussion front.

Today, despite a strong sentiment, the local market is witnessing some amount of profit taking at higher levels after a sharp rally yesterday. The NIFTY index posted an intraday high of 11882 and is currently trading at 11840 levels after posting an intraday low of 11813. The Bank NIFTY is trading marginally down with pressure in Indusind bank which dropped over 2% while ICICI and Axis Banks were down marginally. In sectoral indices today, corrective activity is seen in Auto, PSU banks, Media and Metals while IT index is down on appreciation of rupee v/s the US dollar.

In global markets, the NIKKEI is down 0.2% and Hang Seng fell 0.8% however failed to bring any pressure to Indian market.

In our View, the market is expected to stay positive and a NDA with 300+ may push the Nifty index towards 12100-200 range while the Bank NIFTY may advance towards 31200 levels. The NIFTY index is expected to take support at 11750 and Bank NIFTY has support at 30500 marks. We prefer to buy on dips on indices till tomorrow before the final result on 23^rd May.

We recommend NIFTY May future long at 11800-820 range with strict stop loss below 11740 with targets at 11900 and 11970. One can buy Bank NIFTY futures around 30650-700 range for holding target 31200 with stop loss below 30450

In stocks, Buy Adani Enterprise on correction 148-150 for a short term target of 165 to 176

We maintain positive stance on Realty, Infra, Banks and Financials and Sugar stocks in the short term.

 

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