Market Ends Winning Streak Amid Global Weakness
The Indian equity markets paused their impressive rally on November 18, breaking a six-day winning streak as investors turned cautious amid weak global signals and decided to secure profits. The benchmark Nifty 50 index fell by 103.40 points, or 0.40%, to close at 25,910.05. Similarly, the Sensex dropped 277.93 points, or 0.33%, settling at 84,673.02.
The broader market displayed even greater weakness than the frontline indices. The advance-decline ratio tilted heavily in favor of declining stocks at approximately 1:2, indicating that the cautious sentiment was widespread across the market.
Sectoral Performance and Market Drivers
Several key sectors faced significant selling pressure. The Nifty IT, metal, and realty indices emerged as the top laggards. This downturn mirrored the overnight decline in U.S. technology stocks and was further influenced by a stronger US dollar, which put pressure on base metal prices. However, the market found some support from gains in select banking and public sector undertaking (PSU) stocks, which helped cushion a steeper fall.
Expert Stock Picks from MarketSmith India
Despite the day's consolidation, MarketSmith India has identified two stocks with strong potential for investors. Here is a detailed breakdown of their recommendations for 19 November.
Buy: Aster DM Healthcare
Current Price: ₹680
Buy Range: ₹675–690
Target Price: ₹790 (in two to three months)
Stop Loss: ₹630
Why it's recommended: Aster DM Healthcare boasts a robust operational presence in both the Gulf Cooperation Council (GCC) region and India, giving it a well-diversified revenue stream. The company has demonstrated consistent growth across its hospital and pharmacy businesses and is improving its margins through enhanced operational efficiency. Its strong brand reputation in crucial healthcare markets, coupled with a healthy balance sheet and improving return ratios, adds to its appeal. The management team is experienced with a proven execution record, and the company is pursuing strategic capacity expansion through an asset-light model. It stands to benefit from the rising demand for healthcare services in India and the Middle East.
Key Metrics:
- P/E Ratio: 85.26
- 52-week high: ₹732.20
- Volume: ₹237.55 crore
Technical Analysis: The stock has recently bounced back from its 200-day moving average (200-DMA) on above-average trading volume, a technically positive signal.
Risk Factors: Investors should be aware of the company's high reliance on GCC revenues, which introduces currency exposure and potential geopolitical risks. Other concerns include regulatory changes affecting healthcare pricing and insurance, rising costs for manpower and compliance, intense competition from other private hospital chains, and execution risks associated with its expansion projects.
Buy: Ather Energy Limited
Current Price: ₹668
Buy Range: ₹660–670
Target Price: ₹780 (in two to three months)
Stop Loss: ₹615
Why it's recommended: Ather Energy is recognized as a brand and product leader in India's electric two-wheeler segment. The company is a direct beneficiary of the country's long-term transition towards electric vehicles (EVs), a major structural trend.
Key Metrics:
- P/E Ratio: Not Applicable (NA)
- 52-week high: ₹790
- Volume: ₹407.58 crore
Technical Analysis: The stock has shown a trendline breakout, suggesting a potential upward movement.
Risk Factors: The primary risk associated with Ather Energy is its financial performance. The company continues to report persistent operating losses and negative cash flows and has not yet achieved full profitability, despite improvements in its unit economics.
Nifty 50 and Bank Nifty Technical Recap
The Nifty 50 index formed a bearish candle on its daily chart, indicating hesitation near the upper boundary of its rising trend channel. Its Relative Strength Index (RSI) cooled off to around 60 from overbought levels, while the MACD indicator, though positive, showed signs of narrowing momentum. According to the O'Neil methodology, the market status remains a 'Confirmed Uptrend'. Immediate support is placed at 25,700, with a stronger base at 25,300.
The Bank Nifty also ended its seven-day winning streak, closing at 58,899.25 after forming a bearish candle. Its RSI is positioned near 70, approaching overbought territory, while the MACD is in positive crossover. The index remains in a Confirmed Uptrend, with immediate support seen in the 57,600–57,000 range. A break above 59,000 could open the path towards 60,000.
MarketSmith India is a stock research platform offering tools and advisory services based on William J. O'Neil's CAN SLIM methodology. This article is gifted to you as a Mint Premium article. Investors are advised to consult with certified experts before making any investment decisions.
