Introduction

The Indian stock market has been a hotbed of activity lately, with significant volatility and sharp movements in various sectors. In this day trading guide, we'll delve into the recent market developments, macroeconomic factors, and expert insights to help traders navigate the ever-changing landscape.

Market Overview

In the previous trading session, Indian benchmark indices, Sensex and Nifty, displayed considerable volatility. While the day began with a record high for Sensex, it ended on a lower note. However, it was the mid and small-cap segments that bore the brunt of the selloffs. This pullback was significant as midcaps fell by 2.96%, and smallcaps plunged by 4.02%.

Interestingly, in early trading today, midcap and smallcap indices marked fresh record highs, reaching 33,245.85 and 38,769.33, respectively. These smaller segments had enjoyed remarkable gains in the preceding 11 sessions, with a 9.4% surge in smallcaps and a 7.7% rise in midcaps. Heavyweights like TCS and Larsen Toubro led the gains, while NTPC and Power Grid faced setbacks.

Macroeconomic Factors

Government data revealed that India's retail inflation eased to 6.83% in August from a 15-month high peak in July, primarily due to a fall in food prices. Despite the decrease, this figure remains above the Reserve Bank of India's upper tolerance limit of 6%. Simultaneously, industrial output surged to 5.7% in July, up from 3.7% in June 2023.

Expert Insights

Ajit Mishra, SVP - Technical Research at Religare Broking, anticipates consolidation in the Nifty index following a recent surge. He advises favoring index majors over midcap and smallcap stocks, considering the possibility of profit-taking in the broader indices. Rupak De, Senior Technical Analyst at LKP Securities, adds that Nifty's short-term strength depends on maintaining support around 19,780, with a potential move towards 20,500 on the higher end.

For Bank Nifty, Kunal Shah, Senior Technical Derivative Analyst at LKP Securities, observes that after a week of substantial upward movement, the market experienced selling pressure from higher levels. Key resistance is now at 46,000CE strike, with support at 45,200. A hold at this support could lead to recovery towards 45,600 or 45,800 levels.

Global Influences

Global cues are integral to understanding Indian market trends. Wall Street stocks ended lower, partly due to a 13% drop in Oracle shares following a weak forecast. Additionally, rising oil prices raised concerns about persistent inflation pressures. Brent crude touched $92 per barrel due to a tighter supply outlook, thanks to Saudi Arabia and Russia extending their oil supply cuts until year-end.

Investors are also awaiting US inflation data, ECB's monetary policy meetings, and the US Federal Reserve meeting outcome. Tech giant Apple faced a 1.8% stock drop after unveiling new iPhones, as it grapples with a global smartphone slump. Furthermore, China's Huawei Technologies raised its second-half shipment target for its Mate 60 series smartphone by 20%.

FO Ban List

The following stocks are part of the FO ban list due to crossing 95% of the market-wide position limit (MWPL): Chambal Fertilisers, BHEL, India Cements, Delta Corp, Hindustan Copper, Balrampur Chini Mills Limited, Manappuram Finance, Steel Ath , and Indiabulls Housing Finance. While they are banned in the FO segment, these stocks remain available for trading in the cash market.

Intraday Stock Recommendations

Seasoned market experts have provided their recommendations for intraday trading:

Infosys: Currently trading at ₹1,501, Infosys is displaying bullish sentiment. A buy position at the current market price, with a stop loss at ₹1,470 and a target price of ₹1,545, is advised.
ITC: With a current trading price of ₹451, ITC has shown signs of forming higher highs and higher lows. A buy position is recommended with a stop loss at ₹440 and a target price of ₹470.
Sun Pharmaceuticals: Expected to bounce from a support zone at ₹1,135, Sun Pharmaceuticals offers a buy opportunity at ₹1,145. The target price is ₹1,160, with a stop loss at ₹1,135.
Maruti Suzuki: Maruti Suzuki is seen forming a bullish reversal pattern. Traders can consider a buy position at ₹10,485, with a stop loss at ₹10,150 and a target price of ₹10,750.
Indoco: Buy opportunities in Indoco are in the range of ₹337-₹340, with a stop loss at ₹328 and a target price of ₹360. The stock is expected to maintain its bullish

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