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Vedanta to IDFC First Bank - Jay Thakkar suggests 3 stocks to buy or sell for short-term in F&O segment
On 16 September, the Indian stock market is set to open flat with mixed global cues. The Nifty 50 fell below 23,200 in the previous session, and bank indices face selling pressure. Watch for market trends in response to the FOMC meeting and oil prices.
Stock market today: The Indian stock market benchmark indices, Sensex and Nifty 50, are likely to open flat on Wednesday, 16 September, amid mixed global cues.
The Gift Nifty indicated a subdued start for Indian equities, trading around 23,212, down 10 points from the previous close of Nifty futures.
The domestic equity market ended sharply lower in the previous session, with the Nifty 50 slipping below the 23,200 mark.
The Sensex fell 777.94 points, or 1.04%, to close at 74,003.82, while the Nifty 50 declined 279.50 points, or 1.19%, to settle at 23,118.60.
Nifty 50 has been falling and forming lower lows and lower highs, and with that, the overall index short positions by the FIIs have been rising as well, which is an oversold reading as well.
According to Thakkar, based on the options data, the 23,000 strike has the highest put base, indicating it is immediate support as well. However, the BankNifty has weakened, and despite a positive move by HDFC Bank over the past couple of days, the Index has been facing selling pressure at higher levels. So the short-term trend in BankNifty is also weak unless the 57,000 level is taken out.
The FOMC meeting that starts on the 15th and concludes on the 16th will also be a trigger for markets going forward, and the current weakness may be factoring in the Fed rate hike due to higher inflation driven by higher crude oil prices. Now, the Index is likely to trade sideways to negative unless there is any positive from crude oil prices; until that settles, the overall trend in equities is likely to remain negative. Below 23,000, the next support will be 22,800 and 22,500 levels.
Jay Thakkar of ICICI Securities recommends Max Healthcare Institute futures, Vedanta futures, and IDFC First Bank futures.
The Nifty Pharma and Healthcare sectors have been outperforming the broader market for some time, and the overall trend remains positive.
As for Max Healthcare, significant short covering has helped the stock rebound strongly to ₹1,000 and above. As long as the stock holds above ₹1,000, the short-term trend remains positive, with targets of ₹1,080–1,120, which also marks the upper end of its current range.
According to options data, the ₹1,000 strike has the highest put base, making it an immediate support level. Meanwhile, ₹1,040 has the highest call base. A sustained move above ₹1,040 could pave the way for further upside in the stock.
Vedanta has recently witnessed short buildup, while its price has weakened and formed lower lows on the lower time frame. The Dollar Index has also moved above the 100 level, which is a short-term concern for commodities. Additionally, expectations of a Fed rate hike could weigh on metal consumption amid potentially weaker demand in the near term.
As a result, the short-term trend for Vedanta remains negative. Options data also indicates significant call additions at the ₹260–270 strikes, while the ₹280 and ₹300 strikes have the highest call base. These factors suggest continued resistance at higher levels and a negative near-term trend for the stock.
There has been a significant divergence between the stock price and open interest, with no meaningful addition of long positions even as the stock has touched 52-week highs. Leverage is also not at lower levels, suggesting that the risk-reward setup is relatively favourable.
Although the stock has outperformed the Nifty Bank over the past few weeks, profit booking cannot be ruled out amid weakness in the broader sector. Options data shows the ₹85 strike has the highest put base, while significant call additions have been seen at the ₹86 and ₹88 strikes.
The stock is currently expected to trade within the ₹85–88 range. A sustained move below ₹85 would confirm a breakdown of this range. From a profit-booking perspective, the stock could witness a short-term downtrend.
Disclaimer: 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.
Dhanya Nagasundaram works as a Content Producer at LiveMint, specializing in news related to financial markets, stocks, and business. With over eight years of experience in journalism and content creation, she has honed her skills in data-driven reporting and market analysis. Her focus is on monitoring stock trends, initial public offerings (IPOs), corporate news, policy shifts, and larger economic trends that affect investors and market players. <br><br> At LiveMint, Dhanya consistently writes and produces articles that make complex financial topics accessible to readers. She keeps a close eye on equity markets, commodities, and macroeconomic indicators, assisting audiences in comprehending how global and domestic events influence investment perspectives. Her stories frequently underscore emerging trends within sectors, the IPO market, company earnings results, and market strategies pertinent to both retail and institutional investors. <br><br> Before her tenure at LiveMint, Dhanya accumulated a wealth of professional experience at various companies, including MintGenie, Informist, Cogenics, Chary Publications, KPMG, and the Royal Bank of Scotland. These positions allowed her to establish a solid foundation in financial research, reporting, and content creation. <br><br> Throughout her career, she has explored numerous subjects such as trading strategies, commodities, IPOs, wealth generation, corporate profits, and macroeconomic indicators. Her background in both financial journalism and corporate settings has given her the ability to tackle stories with analytical rigor while ensuring clarity for her audience. Through her contributions, Dhanya strives to deliver insightful, trustworthy, and investor-centric financial content.
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