The Sensex rose 150 points, or 0.19%, to 80,718, while the Nifty 50 added 19 points, or 0.08%, to settle at 24,734.30. In contrast, the BSE Midcap and Smallcap indices each dropped 0.60%.
Two stock recommendations by MarketSmith India for 5 September:
Buy: Manappuram Finance Ltd (current price: ₹284)
- Why it’s recommended: Strong leadership and investment backing, product diversification and growth, high-yield gold loan business, and robust liquidity and capital base
- Key metrics: P/E: 31.26, 52-week high: ₹292.70, volume: ₹75.21 crore
- Technical analysis: Flat base pattern breakout
- Risk factors: Heavy dependence on gold loans and price volatility, rising competition, regulatory pressure, asset quality concerns in non-gold businesses, regulatory hurdles, and compliance risks
- Buy at: ₹284
- Target price: ₹320 in two to three months
- Stop loss: ₹265
Buy: Aster DM Healthcare Ltd (current price: ₹635)
- Why it’s recommended: Aggressive domestic expansion, merger synergies, strategic realignment to focus on India
- Key metrics: P/E: 77.86; 52-week high: ₹675; volume: ₹ 88 crore
- Technical analysis: Downward sloping trendline breakout retest
- Risk factors: Execution risks from aggressive capex, high competition in a fragmented sector
- Buy at: ₹625–640
- Target price: ₹720 in two to three months
- Stop loss: ₹599
How the Nifty 50 performed on 4 September
On Thursday, 4 September, Indian equities ended higher, with the Nifty 50 holding above 24,700 and the Sensex surging over 700 points, driven by optimism around sweeping GST rate cuts aimed at boosting consumption ahead of the festive season.
Auto stocks led the gains, supported by a weaker US dollar, global strength, and supportive technical signals. However, breadth remained negative, with 1,818 NSE stocks declining against 1,226 advancing, underscoring caution in the broader market.
Sectorally, autos, FMCG, and consumer durables outperformed, with Mahindra & Mahindra and Bajaj Finance posting strong gains. Banking and IT stocks, meanwhile, saw selling pressure, capping the benchmarks’ upside.
On the technical front, the Nifty faced rejection near the upper trendline of a descending channel. It failed to close above the key confluence of the 50-day (24,973) and 100-day (24,773) simple moving averages, both of which are flattening and signalling neutral short-term momentum.
Momentum indicators remain mixed: RSI (14) is stuck at 49 within a downward-sloping channel, showing limited conviction unless it breaks above 52. The MACD has turned mildly positive with a bullish crossover, though its shallow histogram slope points to restrained momentum.
Under O’Neil’s methodology, the market status has been cut to “Uptrend Under Pressure” as the Nifty slipped below its 50-DMA, with distribution days now at three. Resistance remains firm at 24,700–24,800, with a decisive breakout needed to open the path toward 25,000. On the downside, support is seen at 24,650–24,600; a breach below this could trigger further declines toward 24,500–24,400. Overall, the index remains range-bound, with key inflection levels set to dictate near-term direction.
How did Nifty Bank perform?
Nifty Bank opened Thursday with a strong gap-up, reflecting early optimism in banking stocks, but the momentum quickly faded as volatility set in and the index surrendered all intraday gains. It still managed to form a bullish candle with a higher high and higher low on the daily chart, suggesting buyers were active at lower levels.
The index opened at 54,379.60, hit an intraday high of 54,450.55 and a low of 53,971.85, before settling at 54,075.45. The price action signals a tug-of-war between bulls and bears—selective buying near lower zones offset by stiff resistance overhead.
Momentum indicators remain mixed. RSI has inched up to 37, hinting at limited recovery, while MACD stays below the central line with a negative crossover, underscoring lingering bearish pressure.
Under O’Neil’s framework, Bank Nifty remains in an “Uptrend Under Pressure.” Traders are advised to stick to fundamentally strong, technically resilient stocks, use strict risk controls, and deploy capital selectively.
Technically, resistance is placed at 54,400-54,500, with a sustained close above this zone needed to confirm a meaningful recovery. A breakout past 55,000 could accelerate bullish momentum. On the downside, immediate support lies at 53,500–53,600; a breach here may trigger nearly 2% further downside, opening the door for a retest of the 200-DMA.
MarketSmith India is a stock research platform and advisory service focused on the Indian stock market. It offers tools and resources to help investors make informed decisions based on the CAN SLIM methodology, founded by legendary investor William J. O’Neil. You can access a 10-day free trial by registering on its website.
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Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before making any investment decisions.
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