Stock recommendations for 5 November from MarketSmith India

Stock market recap: The Indian market closed higher for a fifth consecutive session. Nifty 50 gained 0.63% to end at 23,960.60, its day-high, after a weak start.

The main driver was the return of foreign institutional investors (FIIs), who bought shares worth ₹6,836 crore on 3 November and ₹18,661 crore over five of the last six trading sessions.

Brent crude oil prices easing to about $103.2, strong company earnings, and attractive large-cap valuations also supported the rally. A firmer rupee near 94.60 against the dollar helped further. Media (+5.15%), realty (+2.85%), metal (+2.80%), and energy (+2.17%) led the gains. Nifty IT (-1.50%) was the only sector to fall, as the US midterm results hit technology stocks across Asia.

Buy: Engineers India Limited (current price: ₹301)

• Why it’s recommended: Record order book and strong order inflows across refining, petrochemicals, fertilisers, infrastructure and overseas consultancy projects provide multi-year revenue visibility. Expansion into energy-transition opportunities such as green hydrogen, biofuels, and other emerging sectors, along with rising international business, supports long-term growth.
• Key metrics: P/E: 18.12, 52-week high: ₹321.40, volume: ₹147.96 crore
• Technical analysis: Trendline Breakout
• Risk factors: High dependence on oil & gas sector capex means delays or cuts in refining and petrochemical investments can impact order inflows and execution. Exposure to overseas projects, particularly in the Middle East and Africa, creates risks from geopolitical disruptions, project delays, and execution uncertainties.
• Buy: ₹298–303
• Target price: ₹350 in two to three months
• Stop loss: ₹278

Buy: Indiabulls Limited (current price: ₹31)

• Why it’s recommended: Value unlocking from its real estate portfolio, premium residential developments, and large land bank offers scope for asset monetisation and cash-flow generation. Improving operating performance and turnaround in revenue and profit, supported by project deliveries and collections, helped earnings recovery.
• Key metrics: P/E: 12.68, 52-week high: ₹38.89, volume: ₹48.73 crore
• Technical analysis: Bounce back from its 50-DMA
• Risk factors: Real estate demand remains cyclical and sensitive to interest rates, economic slowdowns, and property market sentiment, affecting sales and valuations. Execution delays, regulatory approvals, and litigation-related issues in property projects can impact cash flow and profitability.
• Buy at: ₹31–31
• Target price: ₹35 in two to three months
• Stop loss: ₹30

Nifty 50 recap

Nifty 50 opened on a negative note at 23,742.25, below its previous close of 23,810.85. It then dipped to its intraday low before buyers stepped in and made a steady recovery. The index opened at 23,742.25, touched a high of 23,960.60, a low of 23,696.15, and closed at 23,960.60, up 149.75 points or 0.63%. It closed at the day's high and posted a fifth straight gain. That shows strong conviction and short covering into the close. BEL (+4.71%), ADANIENT (+4.47%), and TITAN (+4.22%) led the gains, while TCS (-2.52%), HCLTECH (-2.37%), and INFY (-1.73%) weighed on the index. The close above the 100-day SMA is technically significant.

The RSI is at 68.55, close to the overbought threshold of 70 and well above its average of 51.47. This reflects strong bullish momentum after the sharp rally from October lows. MACD at 114.92 has crossed above the zero line, while the signal line is still at -51.90. The histogram at 166.82 is widening, confirming accelerating upward momentum and a trend shift. However, the index is now roughly 1,085 points above its 21-day SMA, and the RSI is near overbought. That leaves the market stretched in the short term and raises the chance of a pause or a test of nearby support.

Immediate resistance is at 24,000, the 200-day SMA. A decisive close above it could extend the rally toward 24,400–24,500. On the downside, support is at 23,700 (100-day SMA and day's low), then 23,230 (50-day SMA) and 22,875 (21-day SMA). The rally is backed by FIIs turning buyers, easing crude prices and paying attention to the U.S. midterm results. Domestic institutions also remain steady buyers. Even so, Brent crude is near $103, and inflation concerns are still risks. Given near-overbought readings, the index may consolidate near 24,000 before its next directional move.

Nifty Bank opened on a negative note against its previous close of 55,540.05, but buyers stepped in after it tested intraday lows. The index then rebounded firmly to close near the day's high and extend its winning streak. The index opened at 55,485.10, touched a high of 55,946.85, a low of 55,294.50, and closed at 55,913.60, up 373.55 points or 0.67%. HDFCBANK (+1.54%), SBIN (+0.90%), and BANK BARODA (+0.85%) led the gains, while KOTAKBANK (-1.13%), AXISBANK (-0.06%), and ICICIBANK (-0.03%) were the only laggards. AUBANK (+2.77%) was the top gainer. The strong bullish candle reclaimed the 50-day SMA, and the lows near 53,800 and 53,600 points to a possible double bottom.

The RSI is at 57.18. It has moved decisively above its average of 45.82 and is pointing higher, which shows improving bullish momentum with room to rise before overbought levels. MACD at -140.13 is trading above its signal line at -300.95. The positive histogram of 160.82 confirms the recent bullish crossover, though both lines are still below zero. Momentum is clearly recovering, but trend strength is not fully established. A MACD move above zero would confirm a shift from a corrective phase to a trending one. Until then, the rally looks like a recovery inside a broader consolidation.

Immediate support is at 55,830 (50-day SMA), followed by 55,300 (day's low) and 55,030 (21-day SMA). On the upside, 56,000–56,100 is the mid-October swing high and the neckline of the possible double bottom. Above that, 56,640–56,710 is a tough barrier where the 100-day and 200-day SMA converge. Foreign institutional investors (FIIs) bought ₹6,837 crore of Indian equities on Tuesday, and cooling crude prices also helped. Still, inflation risk and expected rate hikes by the Reserve Bank of India (RBI) may limit gains. A sustained close above 56,100 could open the way to 56,700. If the index fails there, expect consolidation between 55,000 and 56,100.

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