Market breadth was cautiously optimistic. The session was propelled by the Metal sector, which surged more than 1.8% on global tailwinds and specific positive tariff-related news for bellwethers like Tata Steel. Financials also remained firm, continuing to benefit from the RBI’s recent policy measures.
However, profit-booking dragged down select IT and Auto majors. On the macroeconomic front, sentiment was underpinned by the government’s reiteration of its commitment to higher capital expenditure, although trade concerns persisted following reports of higher US import tariffs on Indian goods linked to Russian oil imports.
Two stock recommendations by MarketSmith India:
Buy: VST Tillers Tractors Ltd (current price: ₹5,455)
Why it’s recommended: Leader in power tillers, strong in compact tractors, rising farm mechanization demand, subsidy support, diversified products: tillers, tractors, harvesters
Key metrics: P/E: 39.72 | 52-week high: ₹ 5,548.50 | Volume: ₹22.05 crore
Technical analysis: Bounce back from its 21-DMA
Risk factors: High reliance on subsidies, demand tied to monsoons & rural income, strong competition from large OEMs, raw material cost volatility
Buy: ₹5,420-5,530
Target price: ₹6,350 in two to three months
Stop loss: ₹5,050
Buy: Multi Commodity Exchange of India Ltd (current price: ₹8,145)
Why it’s recommended: Dominant market position & network reach, rising trading volumes & client base expansion
Key metrics: P/E: N/A | 52-week high: ₹9,115 | Volume: ₹390.72 crore
Technical analysis: Trendline breakout
Risk factors: Regulatory and compliance risk, volatility and market sentiment sensitivity
Buy at: ₹8,100-8,200
Target price: ₹9,000 in two to three months
Stop loss: ₹ 7,750
Nifty 50: How the benchmark index performed on 3 October
The Nifty 50 eked out a modest gain of about 0.23% (+57.95 pts) to close at 24,894.25 (from 24,836.30)—though intra-day swings kept sentiment cautious. Market breadth was positive, with 1,711 shares advancing against 1,356 declining on the NSE, signalling healthy participation beyond index heavyweights. Sectorally, Banks and Metals led the upward movement, with select names in power and infrastructure also gaining, while autos and some financials witnessed profit-taking.
The index extended its rebound with a higher-high and higher-low price structure, decisively holding above the 24,600-24,550 support zone, which had acted as a reliable base over the past four sessions. Importantly, the index has reclaimed its 50-day moving average (50-DMA), signalling short-term stabilization.
However, the immediate challenge lies at the 100-DMA, which now serves as the next resistance hurdle. Momentum indicators provide a mixed setup—the 14-period RSI has bounced from oversold territory, indicating a relief in selling pressure—but remains constrained below its prior downward-sloping trendline, tempering the strength of the bullish case. Meanwhile, the MACD continues to hover in negative territory, underscoring that the broader trend lacks a decisive reversal signal.
According to O’Neil’s methodology of market direction, the market status has been downgraded to an “Uptrend Under Pressure” as the Nifty breached its “50-DMA” and the “distribution day count” is at one.
The index ended on a positive note, closing above both its 50-day moving average (DMA) and the prevailing downward-sloping trendline—a development that underscores near-term strength. On the upside, the next key hurdle is aligned with the 100-DMA, placing 24,950–25,000 as a critical resistance area.
A decisive close above this band would likely reinforce bullish momentum and pave the way for an extension toward 25,150–25,250 in the coming sessions. Conversely, a close below 24,600 could trigger renewed selling pressure, exposing the index to downside targets around 24,500–24,450.
How the Nifty Bank performed
The Nifty Bank opened yesterday on a negative note but gradually attracted buying interest, enabling it to finish in positive territory. The index has now formed its fourth consecutive bullish candle on the daily chart, with a higher high and higher low price structure, which reflects steady accumulation. On the day, the index opened at 55,182.60, touched an intraday high of 55,616.45, and slipped to a low of 55,177 before finally settling at 55,589.25. This consistent upward movement highlights an improvement in investor sentiment, despite initial weakness.
Momentum indicators further reinforce this trend. The RSI climbed to 58 from 55, suggesting a gradual improvement in upside momentum, though it has not yet reached overbought territory. At the same time, the MACD remains above its central line and has registered a positive crossover. This technical setup reflects a strengthening of short-term sentiment, but the broader market structure continues to lack robust confirmation, implying that traders should remain selective and cautious while positioning themselves aggressively.
On the technical front, the Nifty Bank is currently trending above its 50-day moving average (DMA) but remains below the 100-DMA, positioned near 55,700. Sustained strength above this level would open the path toward 57,650, the all-time high, which is less than 4% away from current levels. On the downside, immediate support rests at 54,200-54,500. A decisive breach of this zone could reintroduce volatility and prompt profit booking, thereby disrupting the prevailing momentum. While the overall positioning signals resilience, close attention to support levels remains essential for managing risks.
MarketSmith India is a stock research platform and advisory service focused on the Indian stock market. It offers tools and resources to help investors make informed decisions based on the CAN SLIM methodology, founded by legendary investor William J. O’Neil. You can access a 10-day free trial by registering on its website.
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Disclaimer: The views and recommendations given in this article are those of individual analysts. These do not represent the views of Mint. We advise investors to check with certified experts before making any investment decisions.
