Mumbai: Investors partially booked profit after a six-session rally owing to weak global cues. While the fall was more severe in the mid-session, markets pared losses towards the end to close marginally lower amid weakness in banking, auto, oil and realty shares.

“The big event is the Union Budget in July and investors are pinning hopes on a market-friendly budget that would have a road-map on measures to boost economic activity and prop up the investment cycle,” says Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd.

In the last week, the benchmark indices witnessed some selling pressure at higher levels and the Sensex closed at 77210. Among sectors, banking and financial indices outperformed, rising 3 per cent whereas auto and FMCG indices shed over 2 per cent.

Technically, during the week the benchmark indices registered a fresh all time high of 77851.63 but witnessed some profit booking at higher levels. Small bearish candle on weekly charts and double top formation on intraday charts indicate further weakness from the current levels. However, the medium term texture of the market is still in to the positive side.

Shrikant Chouhan, Head (Equity Research), Kotak Securities, said “We are of the view that, as long as the market is trading below 77,500, the weak sentiment is likely to continue on the lower side. The market could retest the level of 76,700.” Further down side may also continue which could drag the market till 76,100. On the other side, 77,500 would be the immediate breakout level for the bulls. Post breakout, market could move up till 78000-78500.

STOCK PICKS

Granules India

Buy | CMP: 490.65 | SL: 470.00 | TARGET: 525.00

The stock has given a strong breakout above its all-time high resistance mark of 485.95 and successfully managed to close above the same. With the price making higher highs and higher lows and volume spiking up, rising to nearly 8 times its Avg (30) days traded volume, the stock looks poised for a good upside move towards potential targets of 525.00 and above. A set stop loss should be kept at the 470.00 mark to manage risk well on this trade.

Bandhan Bank

Buy | CMP: 209.23 | SL: 204.00 | TARGET: 222.00

The stock has given a good breakout above its Anchor-VWAP resistance mark of 203.00 and successfully managed to close above the same. With volumes in Friday’s session being nearly 2 times its Avg (30) days volume and the RSI (14) being around 66.93, showing a good uptick on the technical charts, the stock looks poised for a strong upside move towards 222.00 and above. A strict stop loss should be kept at 204.00 to manage risk well on this trade.

(Source: Riyank Arora, technical analyst at Mehta Equities)

CMP (Current Market Price); SL (Stop Loss)/ All prices in Rs