Asian Paints, Berger Paints: Can rising crude oil prices dent sentiment?

Consumption of discretionary and non-discretionary items is likely to pick up pace over the next few months as more Indian cities gradually emerge from the lockdown triggered by the second wave of Covid infections. 

The onset of festival season going ahead is also likely to spur consumption. Among the broad consumption basket, shares of Asian Paints and Berger Paints India hit their respective record highs on the BSE in May on expectation of strong volume growth, riding the potential demand shift from unorganised segment. READ MORE HERE

Global markets are currently underestimating the demand for oil as more economies open up for business, said a recent report by Goldman Sachs that expects Brent to hit $80 per barrel going ahead. Recently, S&P Global Platts, too, had forecast oil prices hitting and staying above $70 a barrel by mid-2021, driven by a more broad-based pickup in economic activity amid widening vaccination rollouts. READ ABOUT IT HERE
 

Will this momentum sustain over the next few months, especially at a time when the crude oil prices are likely to inch higher? Here's what charts suggest.

Asian Paints Ltd (ASIANPAINT)
Likely target: Rs 3,100 to Rs 3,300
Upside potential: 7% - 13.79%

If the Asian Paints manages to sustain above Rs 2,900 levels, the upside breakout may result in Rs 3,100 to Rs 3,300 mark, as per the weekly chart. The next immediate support for the stock comes at Rs 2,700 levels. Although the daily Relative Strength Index (RSI) is trading in the overbought condition, the stock is not showing any major weakness. Stay invested for now. CLICK HERE FOR THE CHART
 
 
Pidilite Industries Ltd (PIDILITIND)
Likely target: Rs 2,200
Upside potential: 6.50%

The formation of “Rising Channel Pattern” indicates a firm bullish bias for the counter. The stock is heading towards Rs 2,200 mark, as per the formation on the weekly chart. The volumes on the upper rising trendline show increased interest among investors, which is also indicative of positive sentiment. The medium-term outlook is bullish above the support of Rs 1,800 levels. The immediate support comes at Rs 1,900 levels, as per the daily chart. CLICK HERE FOR THE CHART
 
 
BERGER PAINTS INDIA (BERGEPAINT)
Likely target: Rs 850
Upside potential: 6%

The next breakout level for Berger Paints is Rs 850 levels. The stock is making an all-out effort to hold on to the support of Rs 760. A breakout may see the counter hit Rs 920 and then Rs 940 levels going ahead. The RSI has fallen below the overbought territory reflecting minor profit booking, as per the daily chart. Nevertheless, the stock price is not indicative of any major bearish sentiment. CLICK HERE FOR THE CHART