Nifty may hit 16,400 by Sept, Bank Nifty may soar 11% to 38,600; Check ICICI Direct’s top stock picks

On technical charts, Nifty has shaped a powerful help base within the vary of 14,400-14,600. Picture: Reuters

NSE Nifty 50 is anticipated to problem its lifetime excessive of 15,431 factors and soar to as excessive as 16,400 by September, brokerage ICICI Direct mentioned in a be aware, reiterating the optimistic stance on the home share market benchmark. The brokerage agency believes that the formation of upper peak and trough coupled with multi-sector participation might lead Nifty in direction of revised goal of 16,400 over the following quarter, led by BFSI, consumption, vehicles and infrastructure shares.

On technical charts, Nifty has shaped a powerful help base within the vary of 14,400-14,600. The formation of upper peak and trough on the bigger diploma chart instructed elevated shopping for demand that has made the brokerage agency assured of revising the help base at 14,600. “We anticipate the Nifty to carry 14600 as it’s a 61.8 per cent retracement of present up transfer (15,251-14,151), 20 weeks EMA is positioned at 14,500, and previous three week’s low at 14,592,” it mentioned.

ICICI Direct doesn’t anticipate the index to breach the important thing help threshold of 14600, and has suggested traders to capitalise dips to build up high quality large-cap and midcap shares. With a decline in every day COVID-19 instances in India, Nifty 50 index is simply 100 factors away from its file excessive of 15,431.

As for the Financial institution Nifty index, the weekly bar chart indicators resumption of main uptrend. Analysts anticipate it to steadily head in direction of 38,600 ranges within the medium time period. Consistent with its view, the Financial institution Nifty index maintained the rhythm of not correcting greater than 20 per cent as witnessed since March 2020. Just lately, it rebounded after correcting 19 per cent from its all-time excessive of 37,708, which gives beneficial risk-reward arrange for the following leg of main up transfer in coming months.

Key figures in a nutshell

Nifty

– Revised Goal: 16,400 by September 2021
– All-time excessive: 15,431
– Nifty present degree: 15,301 (shut of Wednesday, 26 Could 2021)
– Sturdy help: 14,600

Financial institution Nifty

– Goal: 38,600
– All-time excessive: 37,708
– Final correction from all-time excessive: 19%

Sectors and shares in focus

Pharma and Chemical substances: The Healthcare index prolonged its uptrend in Could led by sturdy value construction. Technically, Divis Laboratories, Cipla, Caplin Point Laboratories and Solara Energetic Pharma Sciences might outperform. Whereas Abbott India, Indoco Remedies and Dishman Carbogen present beneficial risk-reward setup.

Consumption: The brokerage agency highlighted that shares resembling Asian Paints, Astral Poly, Nilkamal, Kajaria Ceramics are set to outperform whereas Bata India, Titan Company, Trent, Kansai Nerolac Paints, Godrej Consumer Products present a beneficial threat reward setup.

IT: The IT index witnessed a breather after a rally in Could. Throughout the sector, ICICI direct Analysis sees Wipro, Persistent Systems, Cyient, Birlasoft to outperform whereas Tata Consultancy Services (TCS), Infosys, Teamlease shares present a beneficial threat reward setup.

Capital items: Capital items index snapped a two-month breather and made a pointy rebound after testing its 2018-19 peaks which has now turned as help. Shares resembling SKF India, KennaMetal India, Orient Refractories and Siemens shares are set to outperform whereas L&T, ACE, NRB Bearings, Ador Welding shares present a beneficial threat reward setup.

Steel: The brokerage agency expects metallic sector outperformance to taper down whereas holding the general optimistic outlook intact. “We anticipate JSW Steel, Tata Metaliks, Graphite India and Jindal Stainless to outperform whereas Tata Steel, SAIL, Kalyani Metal present beneficial threat reward setup,” it mentioned.

Auto: ICICI direct Analysis expects industrial car, tractor area to increase outperformance whereas 2-wheeler area gives beneficial risk-reward setup. Technically Bajaj-Auto, Tata Motors, Mahindra & Mahindra, Balkrishna Industries and Philips Carbon might outperform whereas Ahok Leyland, ESCORTS, Asahi India, Pricol shares provide a beneficial risk-reward setup.

Realty and Infra: The Infra area has undergone first rate correction in April and Could 2021. The brokerage agency sees outperformance in shares resembling Ambuja Cements, Oberoi Realty, HG Infra. “Whereas PNC Infratech, Sanghvi Movers, India Cements and Mahindra Logistics present a beneficial threat reward setup,” it added.

(The inventory suggestions on this story are by the respective analysis and brokerage agency. Monetary Categorical On-line doesn’t bear any accountability for his or her funding recommendation. Please seek the advice of your funding advisor earlier than investing.)