Mr. Romesh Tiwari, Head of Research, CapitalAim
This week markets closed subdued as the Sensex was down 117.77 points at 39,714.20, while Nifty was down 23.10 points at 11,922.80 on Friday closing. For the next week, Nifty might remain rangebound with some upward bias. 11,800-11,780 may be support for the next few days and if breached can take Nifty further down to 11,650 very fast. On the upside closing above 12,100 will entice more buyers and can see the participation of broader markets. Any big move is unlikely before RBI meet expected on 6th of June. The market is expecting RBI to cut the rates by at least 25 basis point, and we will not be surprised if they decide to cut the rate by even 50 bps, to infuse liquidity and push growth. Although monsoon will also be a concern for the coming quarter as it directly impacts the inflation rate.
Smt. Nirmala Sitharaman as the new finance minister is the right choice given her academic background in economics. She will have to face challenges of the slowdown in domestic consumption and liquidity issues. She will also be heading Corporate Affairs ministry and that will give her more avenues for implementing broadly structured policies for setting long term growth of the economy.
The market will be keenly watching the first Cabinet meeting of the new Modi Govt. for any signal for change in economic policies but there may not be any significant declaration on the very first meet.
HCL Tech: BUY| Above: Rs 1100| Target: Rs 1145| Stop loss: Rs 1148|
HCL Tech recovering from support of trend line drawn from the lows of 12-03-19 and 26-03-19 and RSI is showing buy signal on daily charts, now placed at 52.74 levels.
Mc Dowell-N: BUY| Above: Rs 565| Target: Rs 587| Stop loss: Rs 543
Mc Dowell-N has breached the resistance of trend line drawn from a high of 3-12-2018 and 15-03-2019 on daily charts & forming an inverse Head and Shoulder pattern with the neckline at 564 levels. RSI showing buy signal, now placed at 56.11 levels.
Godrej CP: BUY | Above: Rs 691| Target: Rs 715 | Stop loss: Rs 668|
Godrej CP has shown breakout of the inverse Head and Shoulder pattern on the daily charts and RSI is showing buy signal, now placed at 62.65 levels.