The domestic equities market on Wednesday started the day on a weaker note a day after hitting all-time high levels. The BSE Sensex was trading down by 207.47 points to 80,144.17 in the early trade, while the NSE Nifty dips 49.6 points to 24,383.60.

Amid the 30 Sensex shares, Mahindra & Mahindra saw the biggest fall of 3.8 per cent after the price cut of its SUV XUV 700. It was followed by Axis Bank, Kotak Mahindra Bank, JSW Steel, and IndusInd Bank.

However, Maruti Suzuki were in the green by 2.11 per cent. Other stocks that were in the positive territory included Adani Ports, Infosys, NTPC and Titan.

V K Vijayakumar, chief investment strategist at Geojit Financial Services, said, “Two important factors that have been contributing to the ongoing bull market in India are the global rally and the sustained flows into the Indian market from retail investors. These two factors continue to be intact. The US market is doing extremely well with the S&P 500 returning 17.6% YTD against Nifty’s 12.38% return YTD. The flows into the market from retail investors continue unabated with SIP inflows touching Rs 21262 crores in June. These positive trends can impart resilience to the market even though valuation comfort is low now.”

However investors should be careful about the high level of speculative activity in the Smallcap space where operators are driving up the prices of many shares with low floating stock. The inflation data in the US expected on Thursday will determine the Fed action in September. The disinflationary trend in the US is likely to sustain enabling the Fed to cut rates in September.”

Stocks to Watch Today

Even as the Indian stock market has been rising continuously amid strong sentiments, there are individual stocks that need to be watched closely today, Wednesday, July 10. These include Mahindra & Mahindra, Tata Elxsi, Emcure Pharma, Bansal Wires, Vodafone Idea, Vedanta, Wipro, RVNL and Reliance, among others.

Today, the financial markets in India will be majorly influenced by Q1 earnings, AGM of few corporates, listings, and other stock developments.

Prashanth Tapse, senior vice-president (research) of Mehta Equities Ltd, said, “The Federal Reserve Chairman Jerome Powell insists that a rate cut is not appropriate until there is greater confidence that inflation is moving sustainably toward 2%. Recent inflation readings have shown modest progress, and more positive data could strengthen the case for a rate cut, possibly as soon as September, with up to three cuts anticipated this year.”

Amid this backdrop, bullish investors are revising their Nifty targets higher to 26,000, and attention is now on the US CPI data due on July 11th. The upcoming earnings season, beginning with TCS on July 11th, is expected to be an exciting time for stocks, while the countdown to the union budget presentation by Finance Minister Nirmala Sitharaman on July 23rd has begun.

“Preferred trades include buying Nifty at CMP with targets up to 25,500 and Bank Nifty between 52,100-52,200 with targets up to 54,500. Top stock picks are HINDALCO and LARSEN, both recommended as momentum plays with aggressive targets of 750 and 3,921, respectively,” he added.