- Nifty pharma index has bounced back after forming double bottom at 12,520 levels, say experts
Stock market today: Pharma stocks have been skyrocketing today despite weak sentiments on Dalal Street. Pharma major Morepen Labs share price has ascended to the tune of 12.50 per cent, Shilpa Medicare share is up near 10 per cent, shares of IOL Chemicals and Pharmaceuticals has ascend around 6 per cent whereas Suven Pharmaceutical stocks are up over 3 per cent. Apart from these leading gainers from the pharma segment, shares of Aarti drugs, Caplin Point Lab, Granules India and Divi’s Lab are also up by over 1 per cent.
According to stock market experts, pharma stocks are ascending on renewed fear of rising Covid-19 cases in the world. They said that current rise in pharma stocks are based on the speculative higher revenue and business coming in for the pharma companies in case the Covid cases continue to rise in near future. They said that Nifty Pharma stock has ascended around 2.5 per cent in last one week and it may continue to move northward. They said that Nifty Pharma has strong support at 12,520 and it is facing hurdle at 13,000 levels. They went on to add that on breaching this immediate hurdle, Nifty Pharma index may go up to 13,450 levels. On stocks that one ca look at from the pharma segment, experts said that Sun Pharma, Cipla and Glenmark Pharmaceutical shares are looking promising and one can look at these quality pharma stocks for short term gains.
Speaking on the reason for rise in pharma stocks despite weak sentiment in secondary markets, Avinash Gorakshkar, Head of Securities said, “Pharma stocks are rising due to the renewed fear of rising Covid-19 cases across work, especially in China. These stocks are rising on speculation that in case of further rise in Covid cases, these companies may have an additional business and avenue for revenue in near term. However, this is completely speculative and one should not jump to any conclusion till some concrete news comes on the front of rising Covid cases.”
Expecting further uptrend in pharma stocks, Anuj Gupta, Vice President — Research at IIFL Securities — Research said, “Nifty Pharma stock has bounced from its double bottom support placed at 12,520 levels and it is facing immediate hurdle at 13,000 levels. The chart pattern of Nifty Pharma suggests further bull trend and it may go up to 13,450 levels after sustaining above 13,000 levels.”
Pharma stocks to buy today
On pharma stocks that one can buy in current market slump, Anuj Gupta of IIFL Securities suggested short term investors to look ta Cipla, Glenmark Pharmaceuticals and Sun Pharma. However, he advised investors to keep on booking profit and advised stock investors to avoid long positions in pharma stock in current market scenario.
In stock market today, BSE Sensex is down by around 850 points and it has breached 60,000 levels as well. Nifty 50 index has slumped 275 points and currently quoting around 17,850 whereas Bank Nifty index has lost over 600 points and has breached 41,800 levels.
Disclaimer: The views and recommendations made above are those of individual analysts or broking companies, and not of Mint. We advise investors to check with certified experts before taking any investment decisions.
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