Bullish on PSU Banks, CPSE stocks? UCO Bank, SJVN look strong on charts

Stock market outlook on Nifty PSU Banks, Nifty CPSE stocks: Technical chart suggests up to 22 per cent upside for UCO Bank, SJVN, NHPC and Bank of Maharashtra; here's why.

Shares of state-run firms have dazzled on the NSE and the BSE since the start of the general elections in India on April 19. The Nifty CPSE index has zoomed over 12 per cent, and the Nifty PSU Bank index has jumped 7.3 per cent as against a 4.3 per cent rally in the NSE benchmark Nifty 50 index.

In fact, most of the gains in the state-run stocks have come in the last week, as the market overcame initial hiccups of election uncertainty following lower voter turnout in the Lok Sabha polls 2024.

The rally gathered pace, after Union Home Minister Amit Shah urged investors to consider purchasing stocks before June 4, the pivotal date for the Lok Sabha election results. Expressing optimism, Shah forecasted a surge in the domestic stock market in the forthcoming period. READ MORE

An analysis of 24 stocks, a combination of Nifty CPSE and Nifty PSU Bank index, shows that as many as 15 stocks have registered double digit returns in the election season so far. 

Individually, Cochin Shipyard stock has been the top performer, up almost 83 per cent. Bharat Electronics and Indian Overseas Bank have soared over 20 per cent each followed by stocks like NBCC (India), Bank of Maharashtra, NHPC, UCO Bank and Power Grid Corporation of India. Bank of India is the only loser among the lot, down 4 per cent.

Here's a technical outlook on select stocks as we near the June 04 result date:

Nifty CPSE Index

Last close: 6,602

Support: 6,375; 6,075

Resistance: 6,750

The momentum seems to have turned negative for the Nifty CPSE index after hitting a high of 6,845. The index seems to be on course to test the support at 20-DMA (Daily Moving Average), which coincides with the super trend line around 6,375.

The overall chart structure suggests a positive bias, with the index quoting firmly above the key moving averages. Hence, the index is expected to find support around the 20-DMA. In case, the 20-DMA support fails to hold, the Nifty CPSE index may dip towards the 50-DMA at 6,075. CLICK HERE FOR THE CHART

On the upside, the index will need to sustain consistently above 6,750 levels, in order to regain strength. 

Bank of Maharashtra

Last close: Rs 68.80

Upside Potential: 9%

Support: Rs 66.40; Rs 64

Resistance: Rs 70.80

Bank of Maharashtra stock is presently seen testing resistance around its super trend line at Rs 70.80 on the daily scale. On the downside, near support for the stock is seen at Rs 66.40 - its 20-DMA, followed by Rs 64 - the 50-DMA. On the upside, a fresh breakout can trigger a rally towards newer heights. The stock could spurt to Rs 73 - Rs 75 levels. CLICK HERE FOR THE CHART

NHPC

Last close: Rs 100.20

Upside Potential: 16%

Support: Rs 99.10; Rs 93.20

Resistance: Rs 106

NHPC stock chart represents support around its 20-DMA at Rs 99.10. The stock has broadly held the 20-DMA support since late March 2024. Stronger support for the stock is seen around Rs 93.20 - wherein the 50-DMA and 100-DMA coincide with the super trend line. CLICK HERE FOR THE CHART

As long as these support levels are held, the stock is expected to trade with a positive bias. On the upside, the stock needs to break and trade above Rs 106, in order to set free and rally towards its peak at Rs 116.

UCO Bank

Last close: Rs 58.10

Upside Potential: 21.3%

Support: Rs 54.80; Rs 53

Resistance: Rs 59.80

UCO Bank stock recently broke above its super trend line resistance, thus indicating a likely positive bias as long as supports at Rs 54.80 and Rs 53 are held. On the upside, the stock needs to trade consistently above Rs 59.80, in order to attempt a rally towards its summit at Rs 70.50 levels. CLICK HERE FOR THE CHART

SJVN

Last close: Rs 139

Upside Potential: 22.3%

Support: Rs 134.80; Rs 129.40; Rs 128

Resistance: Rs 150.40

SJVN stock is expected to trade with a positive bias as long as the stock trades above Rs 128 - its 20-WMA (Weekly Moving Average) - a support it has consistently held since June 2023. Near support for the stock can be expected around 134.80 and Rs 129.40. CLICK HERE FOR THE CHART

On the upside, the stock needs to break above the Rs 150.40 hurdle, in order to rally towards Rs 170 levels.

SBI

Last close: Rs 831

Support: Rs 812; Rs 797; Rs 790

shares of the largest state-run bank are seen trading with a bullish bias since February on the long-term charts. The monthly chart suggests that the outlook shall remain upbeat as long as the stock trades above Rs 797. On the upside, the stock may continue to explore unchartered territories.

Meanwhile, the daily chart suggests near support for the stock at Rs 812 followed by Rs 790. CLICK HERE FOR THE CHART