Indian Stock Market Sees Profit Booking Amid Weak Global Cues
The Indian equity market experienced a corrective phase on Friday, February 6, as investors engaged in profit booking, influenced by subdued global signals. The benchmark Nifty 50 index declined by approximately half a percent, thereby ending its three-session positive streak. The selling pressure was widespread, with significant underperformance observed in the metals, automotive, and realty sectors. Broader market indices, including midcap and small-cap segments, also mirrored this downward trend, reflecting a cautious and selective approach among market participants.
Analyst Insights on Market Dynamics and Strategy
Ajit Mishra, Senior Vice President of Research at Religare Broking, provided his perspective on the day's trading activity. He noted that while optimism persists regarding the potential India–US trade agreement, the market's movement was predominantly dictated by mixed international indicators and profit-taking behaviors. "The ongoing decline in precious metal prices, coupled with weakness in global technology stocks, has contributed to domestic selling pressure. This has kept overall market sentiment restrained and participation highly selective across various sectors," Mishra elaborated.
Despite the short-term volatility, Mishra maintains a constructive outlook on the Nifty index. He advocates for a buy-on-dips approach, contingent on the index sustaining above the critical support level of 25,400. Under this scenario, he envisions an initial upside target of 26,000, followed by a potential advance toward new record highs. "Traders are advised to remain selective, focus on stock-specific opportunities, and adhere to disciplined risk management protocols, given the likelihood of continued market volatility," Mishra emphasized.
Short-Term Stock Recommendations from Religare Broking
In line with the current market environment, Ajit Mishra has identified three stocks that present favorable short-term trading opportunities based on technical analysis.
Indian Oil Corporation (IOC)
Previous Close: ₹175.77 | Recommendation: Buy | Target Price: ₹191 | Stop Loss: ₹168
Mishra highlighted a notable strength across the oil marketing sector, with IOC aligning with this broader positive trend. "The stock has confirmed a breakout from a cup and handle pattern, which is a classic continuation formation typically emerging after a consolidation phase within an established uptrend," he stated. Additionally, IOC has established a fresh buying pivot by surpassing its previous swing high, supported by robust trading volumes that indicate clear buyer participation. A bullish crossover on the weekly Relative Strength Index (RSI) further reinforces the positive momentum outlook. "Given this favorable technical configuration, traders may consider initiating long positions in IOC within the specified price range," Mishra advised.
Indus Towers
Last Traded Price (LTP): ₹442.40 | Recommendation: Buy | Target Price: ₹478 | Stop Loss: ₹424
Indus Towers has demonstrated a decisive breakout from a triangle consolidation pattern, signaling the continuation of its prevailing upward trend. The emergence of a buying pivot near the breakout neckline suggests strong accumulation and enhances the probability of further price appreciation. "With the stock price comfortably positioned above positively aligned short-term and long-term moving averages, the technical structure presents an attractive risk–reward setup for initiating fresh long positions," Mishra explained.
REC Limited
Last Traded Price (LTP): ₹382.10 | Recommendation: Buy | Target Price: ₹410 | Stop Loss: ₹368
Following an extended corrective phase, REC Limited has successfully tested and held its key long-term support at the 200-week Exponential Moving Average (EMA), indicating a reduction in selling pressure. On the weekly timeframe, the stock has formed a stable base within the ₹350–390 range, suggesting accumulation by investors. "Improving price action and a constructive broader technical structure point to limited downside risk and a potential upward movement, making REC an appealing long opportunity for traders," Mishra concluded.
Disclaimer: This article is for educational purposes only. The views and recommendations expressed are those of individual analysts or broking firms and do not represent the stance of the publication. Investors are strongly advised to consult with certified financial experts before making any investment decisions, as market conditions are subject to rapid changes and individual circumstances may vary.
