Analysts bullish on FMCG, IT ETFs amid sectoral rebound; check details

Nifty View

For the last two trading sessions, Nifty has been registering higher highs and higher lows, which is a bullish sign. Resistance for the Nifty is seen at 25,669, above which it could extend its gain towards 26,000. On the downside, 23,331 would continue to serve as support.

 

Buy ICICI Prudential Nifty FMCG ETF CMP: ₹59.22 | Target: ₹62 | Stop-loss: ₹57

FMCG sector seems to have bottomed out as many largecap FMCG stocks have turned bullish on the short term charts. FMCG is one of the sectors which has underperformed Nifty in this calendar year. We can expect mean reversion by outperformance from FMCG sector going forward. We recommend going long in ICICI Prudential Nifty FMCG ETF for utilising our bullish view on FMCG sector.

 

Buy Nippon India ETF Nifty IT CMP: ₹42.40 | Target: ₹46 | Stop-loss: ₹39.50

Historically, July has been the best-performing month for the IT index over the last decade. Furthermore, the ratio chart of IT versus Nifty suggests strong prospects for a bullish reversal in the IT sector. We recommend going long in Nippon India ETF Nifty IT, for utilising our bullish view on IT sector.

 

(Disclaimer: This article is by Vinay Rajani, senior technical and derivative Analyst at HDFC Securities. Views expressed are his own.)