The Indian stock market has demonstrated remarkable resilience despite ongoing concerns about valuations and election-related uncertainties. On Monday, May 27, the benchmark indices achieved new milestones, with the Nifty 50 reaching an all-time high of 23,043.20, and the Sensex setting a fresh peak at 75,679.67 during morning trade. These record levels highlight investor confidence and the market’s ability to withstand potential economic and political challenges.
Experts anticipate that the benchmark indices will maintain their gains. However, as the Lok Sabha election results day approaches, there could be some short-term volatility in the market.
Ajit Mishra, SVP of research at Religare Broking, noted that the market’s buoyancy over the past two weeks has reversed the earlier bearish sentiment. He predicts that the Nifty is likely to advance into the 23,150-23,400 range in the near future.
Mishra stated, “If there is a downturn, the 22,550-22,800 zone is anticipated to offer strong support. Although all major sectors are contributing to the rally, banking and IT sectors still possess considerable upside potential. Their involvement could propel the index to even higher levels. We advise maintaining a stock-specific trading strategy, with a preference for large and mid-cap stocks for short-term trades.”
Despite the market reaching record high levels, experts believe certain stocks appear attractive on technical charts and can be considered for short-term gains. According to analysts’ recommendations, the following nine stocks have the potential to deliver double-digit returns in the short term.
Riyank Arora, Technical Analyst at Mehta Equities, highlighted Tata Motors, currently trading at ₹960.55. Arora suggests a target price of ₹1,200 and recommends a stop loss at ₹909. He observes that the stock found strong support around ₹920 and rebounded significantly, potentially forming a double-bottom reversal pattern on its daily charts.
With the RSI (14) hovering around 46 and showing a slight increase from its lower levels at 35, the stock indicates promising momentum and strength, signaling potential price targets of ₹1,200 and beyond in the short term. Arora advises maintaining a strict stop loss at ₹900 to effectively manage risk.
According to Riyank Arora, Technical Analyst at Mehta Equities, Tata Consumer Products is currently trading at ₹1,098.25. Arora sets a target price of ₹1,300 with a stop loss at ₹1,050, indicating an upside potential of 18%. He notes that the stock has experienced a significant breakout above its trendline resistance level of ₹1,115 and has effectively closed above it.
Mandar Bhojane, Equity Research Analyst at Choice Broking, discusses Larsen & Toubro (L&T), which is currently trading near ₹3,600, showing a notable rebound from its recent low. Bhojane observes that the price action has formed a bullish engulfing pattern accompanied by significant volume, indicating a bullish reversal after a correction from its peak. He suggests that L&T could reach target prices of ₹3,800 and ₹4,000 in the near term, advising investors to consider buying on dips, particularly around ₹3,490.
Bhojane highlighted that L&T is currently trading above important exponential moving averages (EMAs), such as the 100-day and 200-day EMAs. This positioning above these significant EMAs strengthens the bullish perspective, indicating the potential for a continued upward price trajectory.
“To mitigate risk effectively, it is advisable to set a stop loss at ₹3,400. This proactive step is essential for protecting your investment in the event of an unforeseen market downturn,” suggested Bhojane.
Vijay Laxmi A Ambala, a SEBI registered independent research analyst, discusses PNB Housing Finance, currently priced at ₹796.45. Ambala sets a target price of ₹900 with a stop loss at ₹742, indicating an upside potential of 13%.
The stock is trading above its key moving averages, including the 20, 50, and 200-day EMAs. Ambala suggests that the housing demand is expected to rise in the coming year, and companies with strong financial conditions will be well-positioned to capitalize on this trend.
Ambala believes that PNB Housing Finance could benefit from the increased demand in the housing finance sector, which might be fueled by favorable government policies, especially during election periods.
