Stock recommendations for 4 November from MarketSmith India

Stock market recap: Indian equities extended their rally for a fourth straight session on Tuesday, as a steep fall in crude oil prices, sustained foreign buying, and growing hopes of capital gains tax relief kept bulls firmly in control.

Nifty 50 rose 370.05 points, or 1.58%, to close at its day's high of 23,810.85, while Sensex jumped 1,225.07 points, or 1.62%, to settle at 76,917.85. Brent crude slipped to around $105 a barrel, about 11% below Friday's six-month high of $118, on optimism over diplomatic efforts to end the Iran conflict.

Foreign investors bought about ₹3,115 crore of Indian shares on Monday, adding to the momentum. Financials, FMCG, and Realty led the gains, while capital market stocks such as BSE jumped up to 8% on hopes of tax relief. Bharti Airtel rose about 5%, Asian Paints nearly 4%, and HDFC Bank, ICICI Bank, and IndiGo about 3% each. IT, Metal, and Pharma stocks lagged, with ONGC, Power Grid, NTPC, and Sun Pharma among the losers, while Reliance saw mild profit-taking. Breadth was positive, with 2,127 stocks advancing, 1,477 stocks declining, and 109 remaining unchanged. The U.S. midterm election results, due after Indian market hours, will be closely watched.

Buy: Garware Hi-Tech Films Limited (current price: ₹7,395)

• Why it’s recommended: Strong growth in high-margin specialty films (Paint Protection Films, Sun Control Films and Architectural Films) supported by capacity expansion and backward integration into TPU manufacturing. The global export-led business has a presence in 90+ countries and vertically integrated manufacturing, providing pricing power, cost efficiencies, and market-share gains in specialty films.
• Key metrics: P/E: 37.97, 52-week high: ₹7,990.00, volume: ₹73.51 crore
• Technical analysis: Trendline Breakout
• Risk factors: Exposure to volatility in crude-linked raw material prices and foreign exchange fluctuations due to significant export dependence. Regulatory risks in the sun-control film segment and demand sensitivity to automotive and construction industry cycles.
• Buy: ₹7,321–7,432
• Target price: ₹9,300 in two to three months
• Stop loss: ₹6,800

Buy: CORONA Remedies Limited (current price: ₹2,271)

• Why it’s recommended: Strong positioning in chronic and sub-chronic therapies (women's healthcare, cardio-diabetes, pain management and urology), which contribute over 70% of revenue and continue to outperform the Indian Pharma Market. A robust brand portfolio with leading “engine brands,” new product launches, and expansion into biologics/biosimilars supporting sustained market-share gains and revenue growth.
• Key metrics: P/E: 60.38, 52-week high: ₹2,294.00, volume: ₹23.72 crore
• Technical analysis: Cup base pattern breakout
• Risk factors: Heavy dependence on the domestic Indian market and key therapeutic segments, making growth vulnerable to pricing pressure and competitive intensity. Reliance on third-party contract manufacturers/suppliers and ongoing pharmaceutical regulatory compliance risks.
• Buy at: ₹2,248–2,282
• Target price: ₹2,900 in two to three months
• Stop loss: ₹2,088

How Nifty 50 Performed

On Tuesday, Indian equity markets rallied, with Nifty 50 surging 370.05 points (1.58%) to close at 23,810.85, reflecting robust buying interest across several sectors. The benchmark opened at 23,582.25, touched an intraday low of 23,482.80, and climbed to the day's high of 23,810.85, indicating sustained upward momentum and a strong finish. Sectoral performance was largely positive, led by FMCG (+3.65%), Realty (+2.33%), Private Banks (+1.98%), Financial Services (+1.89%), and Auto (+1.71%). Meanwhile, PSU Banks (-1.27%) and Metals (-0.14%) underperformed. Broader market sentiment remained constructive, with 2,127 stocks advancing, 1,477 stocks declining, and 109 remaining unchanged. This translates into an advance-decline ratio of approximately 1.44:1, highlighting healthy market participation.

Nifty 50 witnessed a strong bullish session, forming a sizable bullish candle on the daily chart and closing at the day's high, indicating aggressive buying interest. The index has staged a sharp recovery from its recent October lows, with improving price action suggesting a potential short-term trend reversal. Notably, the index reclaimed its key short- and medium-term moving averages and is testing a significant descending trendline, while remaining below its long-term 200-DMA. A sustained move above the descending trendline would strengthen the case for a broader bullish reversal. The Relative Strength Index (RSI) rose sharply to 66.59, reflecting strengthening buying momentum without entering overbought territory. Meanwhile, the MACD has registered a bullish crossover, with an expanding positive histogram, indicating accelerating upward momentum and improving trend strength.

Nifty 50 staged a strong rebound from lower levels, closing above its 100-day moving average (100-DMA), signalling renewed buying interest and improving near-term market sentiment. Technically, the recovery indicates strengthening bullish momentum, although sustained follow-through buying will be crucial to confirm a further upward move. On the upside, 24,000–24,400 is expected to act as key resistance, where selling pressure could emerge. Conversely, 23,500–23,400 is likely to provide immediate support, making it an important zone to monitor for the sustainability of the ongoing recovery.

Nifty Bank gained for a second straight session on Tuesday, rising 537.85 points, or 0.98%, to close at 55,540.05, as strong buying in private sector heavyweights lifted the index alongside the broader market rally. The index touched an intraday high of 55,739 after a gap-up opening, with easing crude oil prices, foreign inflows, and hopes of capital gains tax relief supporting financial stocks. HDFC Bank led the gains, rising about 3%, followed by ICICI Bank (+2%), Axis Bank (+2%). IndusInd Bank and Kotak Mahindra Bank also ended higher. SBI was volatile after reporting a 14% rise in quarterly profit to ₹23,038 crore and a 15% increase in net interest income, ending about 1% higher. Other public sector banks lagged, with PNB, Union Bank, and Canara Bank among the weaker names, while Federal Bank, AU Small Finance Bank, Yes Bank, and IDFC First Bank also slipped. Bank earnings and the outcome of the U.S. midterm election will guide the index next.

Momentum indicators are turning in the bulls' favour. The 14-period RSI climbed to 48.46, above its average of 44.67, and is approaching the key 50 mark, which signals that selling pressure is fading. The MACD line at −320.39 has crossed above its signal line at −367.06, and the histogram has turned positive at 46.67. That is a bullish crossover, though it is still below the zero line, so the recovery is at an early stage. A sustained RSI move above 50 and a MACD push toward zero would confirm the shift. Until then, this remains a rebound inside a corrective structure rather than a confirmed trend reversal.

Bank Nifty staged a recovery, reclaiming its 21-day moving average (21-DMA) and signalling improved near-term market sentiment. Although sustained follow-through buying remains essential to reinforce the recovery and support further upside, the rebound suggests strengthening bullish momentum, . On the higher side, 56,000–56,300 is expected to act as key resistance, where selling pressure may emerge. Conversely, 55,000–54,500 is likely to provide immediate support, making it a crucial zone to monitor for assessing the sustainability of the ongoing recovery. A sustained hold above this support zone would help maintain the near-term positive bias.

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