It was a boring Thursday; auto pharma look attractive

You might call it a boring day on April 11 but the way the S&P BSE Sensex bounced from its intraday low of 38,460 suggests that there is plenty of firepowers left in bulls. The index recovered nearly 150 points from lows while Nifty took support at 11,550.

The final tally – the S&P BSE Sensex closed 21 points higher at 38,607 while the Nifty rose 12 points to close at 11,596.

It looked like traders remained cautious ahead of key earnings of TCS and Infosys on April 12. Besides, important macroeconomic data i.e. IIP and CPI inflation are also scheduled.

On the sectoral front, energy, telecom, and Oil & Gas witnessed buying support while metals, IT and realty stocks witnessed profit booking. The S&P BSE Midcap index rose 0.09 percent while the smallcap index closed 0.02 percent lower.

Global cues were fairly muted from the beginning and it looks like investors are staying on the sidelines till a decisive direction emerges in Nifty either above 11,760 or below 11,500.

Two sectors that are looking fairly attractive are auto and pharma. Among autos, investors can look at Maruti while in the pharma sector Cadila looks attractive, suggest experts.

“Global cues are mixed and most of the global markets are trading near important resistance areas that’s why there is some nervousness. In fact, the broader market is really strong and if there is a breakdown or a breakout, positional traders will enter heavily in the market,” Shrikant Chouhan, VP- Technical Research at Kotak Securities told .

“This time auto and pharma sector are looking attractive. We like Maruti from auto space for a target of Rs 7,800-7,900, which is 10 percent from current levels. It is a buy-on-dips stock. From the pharma space, we like Cadila for a target of Rs 370-375,” he said.

Stocks in News:

IT majors Infosys and TCS fell 1 percent each on caution ahead of March quarter earnings scheduled to be announced on April 12.

Sun Pharma shares declined over a percent after the USFDA observations details for company’s Dadra unit accessed.

Rail Vikas Nigam ended marginally higher at Rs 19.05 against issue price of Rs 19 on listing day.

Power Finance Corporation ended off day’s low after global rating agency S&P revised its outlook to stable from negative.

Jet Airways was down a percent after receiving a few expressions of interests. In addition, promoter Naresh Goyal pledged 26 percent equity with PNB on April 4.

Vedanta fell nearly 4 percent after Cairn India CEO Sudhir Mathur and CFO Pankaj Kalra resigned.

NBCC gained 1.6 percent on bagging orders worth Rs 3,030 crore in March.

Global Updates:

European markets were marginally higher amid gloomy economic outlook. European Union leaders and the UK agreed to a ‘flexible extension’ of Brexit till October 31.

Asian markets ended mixed with China’s Shanghai Composite falling 1.6 percent and Hong Kong’s Hang Seng down 0.93 percent. However, Japan’s Nikkei gained 0.11 percent.