By Rahul Shah
Bulls were back in the seat as headline indices marked consecutive weekly gains with Nifty ending at 18255. Last week all focus was on the IT sector, as we saw the majority of IT companies reported their Quarterly performance. Numbers from Infosys, TCS, and HCL Tech were blockbusters just reinstating the sector rerating and confidence to investors. Indian market did not react negatively compare to the global markets due to strong macro data. Both WPI and CPI number during the month of December reported better than expected. Globally we have seen some profit booking US Inflation spiked to 7% of 40-years high and expectation that the US Fed may hike interest rate sooner than expected.
Sun PharmaTarget: Rs 910 | Stop loss: Rs 845
The stock has given a consolidation breakout with a decisive hold above 850 zones and given a recent highest daily close with entering into multiple years high territory. It has been making higher top – higher bottom on weekly scale and supports are gradually shifting higher. Mechanical indicators like RSI and MACD have entered into fresh bullish breakout scenario which adds the momentum from current zones. Nifty Pharma index is also taking support after the profit booking decline of last eight trading sessions and now turning upwards which also supports the positive stance of the entire sector. Considering the current chart structure, we advise traders to buy the stock for an up move towards 910 with a stop loss of 845 zones
Canara BankTarget: Rs 242 | Stop loss: Rs 220
Financials have been outperforming in the last few sessions, moreover, wholesale bankers have been leading the rally. Canara Bank after making a low of 192, stock has been slow and steady with has been moving up. The stock has given consolidation breakout and has closed above its earlier resistance of 224,We believe PSU banks continue to move up in coming week also. Moreover, sector outperformance gives confidence to buy /hold the stock at current levels. Buy with a stop loss of 22 0 with a target of 242.
(Rahul Shah, Senior Vice President, Group Advisory Leader-PCG, Broking & Distribution, Motilal Oswal Financial Services. Views expressed are the author’s own. Please consult your financial advisor before investing.)