Technical Picks: Vinay Rajani of HDFC Securities suggests these two stocks to buy in the near-term

Stock market today: The primary benchmark indices, Nifty 50 and Sensex, commenced the week on a low note, continuing their decline on Monday as investors responded to disappointing third-quarter (Q3) earnings. Both indices opened lower, showcasing a cautious market and external pressures.

Analysts suggest that the underwhelming corporate earnings for Q3 have not instilled confidence among investors, contributing to worries over elevated valuations and global market conditions. The premium of Indian stocks relative to the MSCI World Index and other international markets has diminished, signaling a change in sentiment.

On Monday, Asian shares displayed mixed performance after US stocks experienced a sharp decline following reports indicating potential economic struggles as consumers and businesses express concerns over President Donald Trump’s policies. Markets in Tokyo were closed for a holiday.

Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services, pointed out that the market is encountering challenges due to ongoing selling by foreign institutional investors (FIIs) and global uncertainties tied to Trump tariffs. Additionally, the recent sharp increase in Chinese stocks presents another challenge in the short term.

The trend of ‘Sell India, Buy China’ is likely to persist for a while as Chinese equities remain appealing. The notable rise in the CBOE VIX suggests that volatility is expected to linger for some time. A positive aspect for our market is that the valuations of large-cap stocks have become reasonable, and certain sectors like financials are notably attractive, providing opportunities for long-term investors to make purchases.

Market Views – Vinay Rajani, Senior Technical and Derivative Analyst, HDFC Securities

Nifty 50

Nifty 50 continues to trend downward, trading below all key moving averages. Recently, it broke down below the crucial support level of 22,700, confirming the downtrend. The previous support range of 22,700-22,800 is now expected to act as resistance moving forward. It is advisable exit shorts once Nifty 50 closes above 22,800.

On the downside, immediate support is identified at 22,460, which corresponds to the 76.4% retracement of the entire rally from 21281 (the low on June 4, 2025) to 26,277 (the high on September 27, 2024). Currently, 17% of members are trading above their 200 DMA in NSSE500. Historically, during bearish market phases, whenever this reading falls into the 10-13% range, it has marked the bottom of the market breadth. Considering this, we can deduce that we are approaching the lower extreme of the current downturn in the broader markets.

Technical Picks: Stocks to buy in the near-term

Vinay Rajani of HDFC Securities recommends these two stocks in the near term – Castrol, and Bharat Heavy Electricals Ltd (BHEL).

Buy Castrol ( ₹214) | Target ₹230 | Stop-loss ₹203

Primary trend of the stock has been bullish, as it has been holding its level above all important moving averages. Stock recently surpassed the previous swing high of 215.50, which added strength in the uptrend. Indicators and oscillators have been showing upward trend for the stock.

Buy Bharat Heavy Electricals Ltd (BHEL) ( ₹192): | Target ₹208 | Stop-loss ₹182

RSI on the Daily chart has formed Positive Divergence. On 19 th Feb 2025, Stock price formed bullish “Engulfing” candlestick pattern on the daily chart. Capital Good and Power sectors have shown sign of bullish reversal.

Disclaimer: The views and recommendations above are those of individual analysts, experts and broking companies, not of Mint. We advise investors to check with certified experts before making any investment decision.