Buy or sell stocks: The key benchmark indices of the Indian stock market ended lower on Friday last week. The Nifty 50 index lost 96 points and closed at 25,327. However, domestic equities logged weekly gains despite intraday losses, supported by a risk-on tone and broad-based global strength. At the close, the Sensex fell 387.73 points or 0.47% to close at 82,626.23, while the Nifty shed 96.55 points or 0.38% to settle at 25,327.05.

The Midcap and Small Cap indices finished essentially unchanged. Sector-wise, consumer durables, media, auto, FMCG, and IT saw mild profit-taking, easing 0.4–0.6%, whereas power and PSU banks outperformed with gains of around 1% each. Progress in US-India trade negotiations and improved global liquidity continued to underpin sentiment. Meanwhile, Adani Group stocks surged up to 10% intraday after SEBI cleared the group in the Hindenburg probe, triggering renewed investor confidence and strong buying interest across the conglomerate.

Stock market next week

Sumeet Bagadia, Executive Director at Choice Broking, believes the Indian stock market sentiment is still positive, as the Nifty 50 index is sustaining above 25,300 to 25,250 support. However, the key benchmark index is facing hurdles at 25,450 to 24,500. On a decisive breakout above this resistance, we can expect the 50-stock index to touch 25,800 levels in the near term.

Speaking on the outlook of the Nifty 50 index, Sumeet Bagadia said, “Despite sell-off on Friday, the positive bias of the Indian stock market is still intact as the Nifty 50 index is sustaining above the crucial 25,250 to 25,300 range. So, Monday’s first few hours of trade would be crucial as the index is facing a hurdle at the 25,450 to 25,500 levels. So, one should maintain a stock-specific approach and look at those stocks that look strong on the technical chart.”

Sumeet Bagadia’s stock recommendations

Sumeet Bagadia recommended buying the following three stocks on Monday: Shriram Finance, SBI, and Hero Motocorp.

1) Shriram Finance: Buy at ₹633.20, Target ₹700, Stop Loss ₹600.

Shriram Finance’s share is currently trading at ₹633.20. It has recently witnessed a retracement towards its crucial support zones, from where it has shown a strong bounce, indicating renewed buying interest. During the daily timeframe, the stock had been moving within a falling trend line formation and had recently given a decisive breakout, signalling a potential trend reversal. This consolidation phase near the support has also resulted in the formation of an Inverted Head & Shoulder pattern on the daily chart, and the stock is now on the verge of breaking out from this bullish structure.

Adding to the positive outlook, the stock comfortably holds its key moving averages above all, further confirming the ongoing momentum’s strength. The RSI is currently at 59, reflecting strong bullish sentiment and suggesting that the stock still has room for further upside movement.

In conclusion, if Shriram Finance shares manage to sustainably move above the ₹640 level, it would confirm the bullish breakout and could trigger an upward rally towards the ₹700 mark. The bullish setup remains valid if the price exceeds the key support at ₹600. Traders can consider initiating fresh long positions at the current market price of ₹633.20 with a strict stop loss at ₹600 to safeguard against any downside risk.

2) SBI: Buy at ₹862.35, Target ₹950, Stop Loss ₹820.

SBI share price is currently trading at ₹862.35 and has been consolidating within a wide range while maintaining an overall upward trend. The stock is moving inside a rising parallel channel and has gradually advanced from the lower range of this channel towards its upper boundary, showing sustained buying interest. It is now on the verge of breaking out of this formation, which could mark the beginning of a fresh bullish leg.

In the past few sessions, the SBI share price has witnessed a strong upward move accompanied by a noticeable rise in trading volumes, further reinforcing the positive sentiment. The RSI is at 76.83, hovering near the overbought zone but still curving upwards, indicating persistent bullish momentum. Moreover, the stock is comfortably trading above all its key moving averages, confirming the underlying strength of the trend.

In conclusion, if the SBI share price manages to sustainably move above the ₹865 to ₹870 range, it would confirm the breakout and potentially extend its bullish trajectory towards the ₹950 mark. Traders can consider initiating fresh long positions at the current market price of ₹862.35 with a strict stop loss at ₹820 to protect against any unexpected downside.

3) Hero Motocorp: Buy at ₹5408, Target ₹5900, Stop Loss ₹5165.

Hero Motocorp’s share is currently trading at ₹5,408 and has been in a long-term uptrend, consistently forming higher highs and higher lows over the past few weeks. The stock has also developed a rounding bottom pattern for the daily timeframe. It is now approaching its breakout zone, indicating a strong upside continuation potential if the breakout is confirmed.

The RSI is currently at 70.97, showing an upward curve with the possibility of a positive crossover, which signals strengthening bullish momentum. Additionally, Hero Motocorp’s share is comfortably trading above all its key moving averages, further reinforcing the ongoing strength of the uptrend.

In conclusion, if Hero Motocorp’s share manages to sustain a move above the ₹5,500 level, it would confirm the breakout and could trigger a strong upside move towards the ₹5,900 mark. Traders can consider buying at the current market price of ₹5,408 with a strict stop loss at ₹5,165 to safeguard against any unexpected downside risk.

Disclaimer: This story is for educational purposes only. The views and recommendations expressed are those of individual analysts or broking firms, not Mint. We advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and circumstances may vary.