Stocks to buy or sell: Dharmesh Shah of ICICI Sec suggests buying JSW Energy, Chalet Hotel shares tomorrow- 21 July 2025
By the end of trading, the Sensex fell by 501.51 points, or 0.61%, closing at 81,757.73, while the Nifty 50 dropped by 143.05 points, or 0.57%, to finish at 24,968.40.
Throughout the week, Indian equity markets showed a mixed performance, with both the Nifty 50 Index and Sensex sliding by 1%, whereas small-cap stocks gained 1.4% and mid-caps increased by 1% in the same period.
Investors are now looking forward to updates on trade negotiations with the US as the August 1 deadline approaches, following President Donald Trump's previous remarks suggesting that a deal with India is nearly finalized. Analysts predict that the markets are likely to see a significant change only after a concrete resolution is reached in the trade discussions with the US.
Dharmesh Shah of ICICI Securities expects Nifty 50 to find supportive efforts in the vicinity of 24,800 zone and gradually stage a rebound wherein 25,800 would continue to act as resistance. Shah has recommended two stocks to buy for short-term. Investors should consult experts before making decisions. Here's what he expects from Indian stock market next week, along with his stock recommendation.
Equity benchmarks extended losses over third consecutive week in the absence of clarity on India - US bilateral trade deal. Nifty 50 lost 0.7% to settle the week at 24968. However, broader showed resilience, outperforming by gaining 1% during the week. Sectorally, Realty, PSU Bank, Auto remained at forefront while Defence, IT extended losses. The weekly price action formed a small bear candle carrying lower high-low, indicating extended breather.
In the upcoming week, volatility to remain elevated as one third of Nifty 50 weightage is coming out with the Q1 earnings post market hours on Friday along with that any development on the US bilateral trade agreement would trigger momentum in the market. With current 2.9% correction, Nifty 50 has approached lower band of rising channel. We expect index to find supportive efforts in the vicinity of 24,800 zone and gradually stage a rebound wherein 25,800 would continue to act as resistance.
Despite weakness in the benchmark, the market breadth has seen improvement as currently 65% of stocks of Nifty 500 universe are trading above their 200 days SMA compared to last week's reading of 60% while last month reading was 52%. The consistent improvement in the market breadth signifies inherent strength.
Structurally, since April intermediate corrections have been limited to 3% while sustaining above its 50 days EMA. In addition to that, over past 14-days index has retraced 61.80% of preceding 11-days 5% up move. Slower pace of retracement indicating robust price structure that bodes well for next leg of up move. Hence, focus should be on accumulating quality stocks on dip backed by strong earnings as strong support is placed at 24,500 being confluence of 100 days EMA and June month low.
a. Earnings update from index heavy weights would be important to watch out for.
b. All eyes will be on outcome of US-India bilateral trade deal.
c. Falling US Dollar index would result into FII's inflow.
d. India VIX has extended losses and sustaining below one year low of 12, indicating participants anxiety at lowest level.
Dharmesh Shah of ICICI Securities recommends buying JSW Energy, and Chalet Hotel shares this week.
1. Buy JSW Energy shares in the range of ₹ 523- 535. He has JSW Energy share price target of ₹ 572 with a stop loss of ₹ 509.
2. Buy Chalet Hotel shares in the range of ₹ 865-890. He has Chalet Hotel share price target of ₹ 1,010 with a stop loss of ₹ 818.
Disclaimer: The Research Analyst or his relatives or I-Sec do not have actual/beneficial ownership of 1% or more securities of the subject company, at the end of 18/07/2025 or have no other financial interest and do not have any material conflict of interest.
The views and recommendations provided in this analysis are those of individual analysts or broking companies, not Mint. We strongly advise investors to consult with certified experts before making any investment decisions, as market conditions can change rapidly and individual circumstances may vary.
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