Fast & Furious! Top 12 stocks which rose up to 400% as Nifty rallies from 10,000-10,600

The Nifty 50 raced from 10,000 levels recorded on 26th July 2017 to 10,600 in January 2018 which translates into a gain of nearly 6 percent but as many as 36 stocks rose more than 10 times in the same period.

It has been a dream run for Indian markets in the year 2017. The Nifty50 closed above 10,000 levels for the first time in July 2017 but there were as many as 36 stocks which gave 10x return than the Nifty index in the same period.

The Nifty50 raced from 10,000 levels recorded on 26th July 2017 to 10,600 in January 2018 which translates into a gain of nearly 6 percent but as many as 36 stocks rose more than 10 times in the same period.

Stocks which gave 60-480% return from the period July 2017-January 2018 in the S&P BSE 500 index include names like Jai Corp, VIP Industries, Divi’s Laboratories, KEI Industries, Torrent Power, Adani Transmission etc. among others.

 

Stocks which more than doubled your wealth in the same period include names like HEG, Graphite India, Rain Industries, Bombay Dyeing, Phillips Carbon Black, Jai Corp, Meghmani Organics, Himadri Speciality, PC Jeweller, Gujarat Alkalies, VIP Industries, and Bombay Burmah.

For the year, the Nifty50 rose by about 29 percent but analysts caution investors to tone down their expectations from equity markets for the next 12 months. The index might at best give a low-teen return but the traditions of Nifty hitting fresh record highs is likely to continue.

The stupendous rally which we saw was driven not only by liquidity but also by hope of earnings and economic recovery (due to reforms by Modi government) going ahead, which had been lagging for many quarters in the past.

That kind of returns seem unlikely in 2018 though earnings and economic recovery look possible is the word coming from Aditya Birla Capital. What it expects is 12-15 percent return in the current year and the similar kind of uptrend is likely to continue in 2019 & 2020 as well.

Analysts do not expect a major correction on D-Street but a 3-5 percent correction could give a good entry point to long-term investors. However, investing should follow a staggered approach to investing because the upside remains limited.

Markets have been relentlessly rallying day after day with most stocks at their 52-week highs. The Midcap and smallcap universe in particular clearly seem to be in overvaluation zone.

This is more of a trader's market currently and the margin of safety for short-term investors is pretty low. Hence, new investments, if to be made for the short to intermediate term, are exposed to higher volatility and price risks.

We believe that if market indices are to correct by 3-5%, it will be a healthy sign for a sustained bull run to continue. We also believe that the budget will be rural and infra focused which will benefit sectors like Agrochemicals, Cement, FMCG and 2 wheelers.

MORE WILL UPDATE SOON!!

Technical View: Nifty forms a Doji like pattern; tread with caution with stop below 10,600

The Nifty 50 which opened at 10,645.10 rose to a record high of 10,659.15 which made a small upper shadow, but bears quickly took control and pushed the index towards 10,603 which made a long lower shadow on the daily charts.

  

Bulls powered D-Street to yet another record high for the third straight day in a row on Tuesday. The index witnessed some profit booking but recouped initial losses to close near day’s high making a Doji pattern on the daily charts.

A 'Doji' is formed when the index opens and then closes approximately around the same level but remain volatile throughout the day which is indicated by its long shadows on either side. The body will be insignificant which will appear like a plus sign on the charts.

The Nifty50 index continued its formation of higher highs and higher lows for fifth consecutive sessions and registered a fresh lifetime high of 10659 zones.

The Nifty50 which opened at 10,645.10 rose to a record high of 10,659.15 which made a small upper shadow, but bears quickly took control and pushed the index towards 10,603 which made a long lower shadow on the daily charts.

The bulls took control and pushed the index towards its record high. The Nifty finally closed 13 points higher at 10,637, a fresh record closing high.

Investors are advised to stay long but tread with caution because the index is trading near key resistance levels. Analysts advise traders to keep a strict stop loss below 10,600 on a closing basis as this rally can falter going into the budget at any point in time.

“The Nifty50 registered a Doji kind of indecisive formation suggesting that traders are clueless at higher levels about further direction as the market remained range-bound throughout the trading session,” Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in told Moneycontrol.

“Though weakness is visible on short-term charts bulls are putting up a brave face with new lifetime highs. Hence, traders can choose to flow with the momentum but at the same time need to remain cautious and maintain tight stops for their long positions,” he said.

Mohammad advice traders to put a stop below 10600 on a closing basis for the next session. If the move gets extended on the upside beyond 10660 a modest target of 10700 can be expected in the near-term.

India VIX moved up by 0.78 percent at 13.85. VIX has to hold below 13-12.50 zones to support the fresh leg of the rally with a smooth ride in the market.

On the options front, maximum Put open interest was seen at 10500 followed by 10400 strikes while maximum Call OI was seen at 11000 followed by 10600 strikes.

“We have seen fresh and significant Put writing at 10600 and 10500 strikes which is shifting its support while fresh Call writing is seen at 10700 and 10600 strikes. Option band signifies a shift in support to 10550-10600 zones as this strike has seen fresh Put OI congestion.

“Nifty witnessed a decline from higher levels but finally closed on a positive note by forming a Small Bodied candle on the daily scale. Now index continues to hold above 10550 zones to extend its up move towards 10700 while on the downside supports are seen at 10500 levels.

MORE WILL UPDATE SOON!!