Both Sensex and Nifty lost more than 5% over the week amid extremely negative market breadth. Almost all sectors witnessed profit taking without any exception. Only some of the IT and Pharma stocks showed some resilience. Dr Reddy, Ranbaxy, Tata Motors, Wipro, Sun Pharma, Zee and Grasim were the only stocks which managed to escape the week without losses. The prominent losers were RCOM, Suzlon, DLF, Unitech, Reliance Capital, Reliance Infra, Hindalco, Reliance Power, ICICI Bank, JP Associates, Idea, Bharti, Siemens, Tata Steel, Jindal Steel and SAIL all of which lost more than 10% over the week.
As predicted last week, markets witnessed correction throughout the week amid volatile global markets. The correction may extend further as markets face resistance at every rise. 4500/4400 on Nifty is still a possibility but we may see a bounce back before that happening. 4850-4900 is a strong resistance for immediate term and we may see Nifty honoring this resistance. However, we may witness stock specific action going forward. Sell weaker sectors/stocks on rises and buy stronger ones on dips. Falls like these give opportunities to buy strong medium term stocks. Following are some of these stocks.
BUY
INDIANB @ 148-150 Tgt 220 SL 135
SUNPHARMA @ 1300-1320 Tgt 1600 SL 1220
POLARIS @ 150-152 Tgt 200 SL 140
OFSS @ 2050-2070 Tgt 2600 SL 1960
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