Indian stock markets experienced a significant downturn on Wednesday, driven by weak global sentiment surrounding former US President Donald Trump's proposed tariffs. The benchmark indices witnessed sharp declines across the board, reflecting widespread investor anxiety. However, a notable recovery was observed later in the trading session, particularly for the Nifty 50 index, which managed to claw back from a critical psychological level.
Market Performance and Key Indices
The trading day began with intense selling pressure, leading to a broad-based market crash. The Nifty 50 index, a key benchmark for the Indian equity market, initially plummeted below the crucial 25,000 mark, causing concern among investors. Despite this steep fall, the index demonstrated resilience by staging a strong recovery, ultimately closing 75 points lower at 25,157. This rebound from the day's low provided some relief but was insufficient to fully offset the negative sentiment.
Similarly, the BSE Sensex faced substantial losses, shedding 270 points to finish at 81,909. The banking sector, represented by the Bank Nifty index, was hit particularly hard, crashing by 603 points and closing at 58,800. The market downturn was not limited to large-cap stocks; smaller segments also suffered significant declines. The Small-cap index nosedived by 0.80%, while the Mid-cap index fell by over 1%, indicating that the sell-off was pervasive across market capitalizations.
Expert Analysis and Market Outlook
Sumeet Bagadia, Executive Director at Choice Broking, provided insights into the market's performance and future trajectory. He emphasized that despite the strong recovery witnessed on Wednesday, the overall bias for the Indian stock market remains weak. Bagadia pointed out that the Nifty 50 index breached the 200-day exponential moving average (200-DEMA) support at 25,000 but managed to regain this psychological level by the close. However, he cautioned that this recovery alone is not enough to boost bullish sentiments.
To foster a more positive environment, Bagadia stated that the Nifty 50 index needs to close above the 25,500 level. He elaborated on the technical outlook, noting that the index failed to sustain at higher levels and closed lower, indicating persistent selling pressure and a weak undertone. Immediate resistance is placed in the 25,250-25,300 zone, while support is seen at 25,000–25,050. The daily Relative Strength Index (RSI) stands at 27.89 and continues to trend lower, reinforcing the bearish momentum. Additionally, the index closing below its 200-DEMA suggests weakening momentum and the likelihood of a continuation of the corrective phase.
Bank Nifty Technical Perspective
Regarding the Bank Nifty index, Bagadia highlighted that the technical chart pattern indicates a pullback-driven recovery within a broader consolidation phase. Immediate resistance is placed in the 59,000–59,100 zone, while supports at 58,500 and 58,600 remain crucial for sustaining near-term stability in banking stocks. On the daily charts, the RSI stands at 40.77 and is trending lower, suggesting a loss of short-term momentum despite the underlying positive structure.
Stock Recommendations for Intraday Trading
In light of the market conditions, Sumeet Bagadia recommended five breakout stocks for intraday trading, each with specific entry points, targets, and stop-loss levels. These recommendations are based on technical analysis and emerging patterns.
- IFCI: Buy at ₹58.56, Target ₹63.80, Stop Loss ₹56. The IFCI share price is trading around ₹58.56 after a phase of range-bound consolidation, where it formed a base and bounced back, indicating emerging strength. The recent uptrend is supported by healthy volumes, signalling active participation.
- PGIL: Buy at ₹1447.40, Target ₹1595, Stop Loss ₹1374. The stock is trading around ₹1,447.40 and continues to form a higher–high, higher–low structure on the weekly chart, indicating a sustained uptrend.
- IDBI Bank: Buy at ₹98.20, Target ₹107, Stop Loss ₹93.50. IDBI Bank's share price is trading around ₹98.20 and continues to maintain a higher-high–higher-low structure on both the daily and weekly charts, indicating a sustained uptrend. The stock recently broke its previous high, retraced towards the 200-day EMA, and bounced back, reflecting buying interest at lower levels.
- Dabur: Buy at ₹516.20, Target ₹555, Stop Loss ₹497. The stock is trading around ₹516.20 and is forming a symmetrical triangle pattern on the daily chart, indicating consolidation within a sideways range. The stock has taken strong support at the rising trendline and is moving higher, reflecting buying interest. A recent bullish engulfing pattern signals a potential reversal.
- Samvardhana Motherson: Buy at ₹109.67, Target ₹117, Stop Loss ₹105. The stock is trading around ₹109.67 and continues to maintain a higher–high, higher–low structure, indicating a longer-term uptrend. The stock recently consolidated, formed a base near the support zone, and bounced back strongly from the 200-day EMA, highlighting buying interest.
Key Takeaways and Market Implications
The Indian stock market is currently grappling with a weak bias, exacerbated by global uncertainties such as Trump's tariffs. The recovery from the Nifty 50's dip below 25,000 offers a glimmer of hope, but experts caution that sustained upward movement requires closing above key resistance levels. The identified support and resistance zones for both the Nifty 50 and Bank Nifty indices will be critical in determining future market movements.
For traders seeking opportunities amidst the volatility, the five recommended stocks—IFCI, PGIL, IDBI Bank, Dabur, and Samvardhana Motherson—present potential breakout scenarios based on technical analysis. Each stock has been analyzed for specific patterns and entry points, providing a structured approach for intraday trading.
Disclaimer: This story is for educational purposes only. The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions.
