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Buy on every dip, say experts

Dipan Mehta, Member, BSE and NSE, said, "I am not at all alarmed by today’s fall. What we are seeing is a natural correction taking place after the market has rallied for the past few trading sessions. It is more or less like a temporary correction and I think that the overall market remains in extremely positive territory. We are in a bull market and these are just minor corrections, which investors should take as an opportunity to perhaps increase their exposure to equity."

He believes that if the build up in the futures market continues then it may cause a correction. "We are seeing the level of open interest near about what we saw in the first week of February, which was particular high at that point of time. A number of stocks have been added to the futures market and we need to keep that in context. A lot of the open interest this time around is in the hands of experienced traders, hedge funds and it’s not as much with retail investors, which is positive. Even the cost of carry has not completely gone out of whack, it’s not anywhere in the danger zone. There is a build up taking place in the futures market and at some point of time in the future if this particular trend continues then it may cause a correction. At this point of time, I certainly don’t see that as a factor which may cause further decline in stock prices," he added.

Anish Damania of Emkay Stock Brokers says, "I think market looks okay. We were expecting a little bit of a pullback, which has happened; so it is good in a way for the markets to pull back after a decent rally." With the correction that was expected being done away with, Damania sees probably one or two more days of weakness. For the next few months, he predicts that the banking, metals and engineering stocks will perform.

Markets today

Markets close in the red on profit booking in late trade

Sensex ends down 0.6% at 14,363, Nifty down 0.7% at 4246

FMCG, oil, auto shares drag; metal stocks defy broad trend

BSE FMCG, Oil & Gas, & Auto indices end down over 1% each

BSE Metals index closes up 1%; Tata Steel up 4.9%

NSE CNX Midcap index closes down 0.8% at 5581 points

BSE Small Cap index gives up gains to end down 0.7% at 7238

Market breadth negative; NSE Advance Decline ratio around 1:2

Total market turnover was Rs 49,955.04 cr vs Rs 50,069.21 cr

Intraday Calls for 23rd May

NSE : Major support range 4075 to 4089. It will take support 4264, 4247, 4217, upper side it will face resistance 4295 and crossover it can move up to 4312.
Buy Century Textile above Rs. 650/- Target Rs. 666-670-675/- SL Rs. 642/-
Buy Torrent Power @ Rs. 76/- Target Rs. 80-82/- SL Rs. 74/- (Signed MOU with Gujarat Power Corporation Ltd. for setting up a 1000+ MW coal based power project at Pipavav in Amreli District, Gujarat.)
Buy Rama Newsprint @ Rs. 38/- Target Rs. 42-44/- SL Rs. 36/-
Buy KEI Industries @ Rs. 83/- Target Rs. 88/- SL Rs. 80/- (Also rec. as investment)
Buy Wipro @ strong support level 528/- (if sustain above 528) Target Rs. 540-545/-

Others are Dolphin Offshore, Aftek, Mysore Cement, TVS Motor, RNRL (Ultimate target Rs. 40-42/-), Prithvi Info (Ultimate Target Rs. 500+ for med to long term).