Sector Spotlight – beaten down metal sector holds promise in short term; analyst Simi Bhaumik suggests 4 stocks for high returns

The India stock markets ended in the red on Friday, snapping a three-day winning streak. Broader market Nifty50 ended almost 5 points lower than the Thursday closing price. Meanwhile, the 30-share BSE Sensex ended at 58,786.67, down by over 20 points.

However, certain sectors held firm and managed to close in the green on the last trading day of the week. Out of the 15 sectoral indices, eight ended positively while remaining seven settled with losses. The biggest losers were Nifty Consumer Durables followed by Nifty Financial Services. The best performing indices were Nifty Media, Nifty Realty and Nifty PSU Bank.

See Zee Business Live TV Streaming Below:

Technical Analyst Simi Bhaumik said that Nifty Metal was one sector that could trump its many other peers. The sector has been a laggard and offers high return potential to investors in the short term, she said.  

She picks four stocks – three for buys and one for hold – that she believes could be a standout stocks for the investors.

On Friday, Nifty Metal closed at 5,658.90, gaining almost 29.10 points or 0.52 from the previous closing levels. In the 15-share index, 11 stock advanced at the closing time while the remaining four declined.

The top gainers on this index were Hindustan Copper Limited, APL Apollo Tubes Limited and Wel Corp Limited which were up 5.6 per cent, 4.6 per cent and 3 per cent respectively. The top losers were National Aluminium Company Limited, Coal India Limited and Hindustan Zinc Limited. The share were down almost 1 per cent, 0.9 per cent and 0.4 per cent respectively.

Bhaumik’s top buys in this sector include Tata Steel Limited, Hindalco Industries Limited, Vedanta Limited and JSW Steel Limited.

Tata Steel: Buy on Dip| LTP: Rs 1178| Target: Rs 1300| Stop Loss: Rs 1100| Upside 10%

Tata Steel shares ended with gains on Friday. It is one of the preferred stocks recommended by Bhaumik for buying on dips. She said that an upside of over 10 per cent is open in this stock from the current levels. She sees a resistance at Rs 1240 after which an upside till Rs 1300 will open for this stock. It may even test levels of Rs 1350 over a positional term basis. Right levels to enter the stock is Rs 1150.

Hindalco Industries: Buy| LTP: Rs 454| Target: Rs 490/510| Stop Loss: Rs 440| Upside 12%

Hindalco settled in the red on Friday. This is another stock that has a good return potential. Investors cab buy this stock at current levels, she said. She suggests two targets for this stock.

Vedanta: Buy| LTP: Rs 349| Target: Rs 390| Stop Loss: Rs 330| Upside 12%

The stock ended positively on Friday, though the gains were modest. An upside of 12 per cent is seen in this stock over a short term period. The technical analyst recommends a buy at current levels.

JSW Steel: Hold| LTP: Rs 679| Target: Rs 710| Stop Loss: Rs 700| Upside 5%

The JSW Steel shares have seen a strong rally over the last 4 trading sessions moving from levels of Rs 641. No fresh positions should be made in this stock, she said. It must be held for a price target of Rs 700-Rs 710. A stop loss of Rs 650 must be strictly adhered to on a closing price basis

(Disclaimer: The views/suggestions/advises expressed here in this article is solely by investment experts. Zee Business suggests its readers to consult with their investment advisers before making any financial decision.)