Sensex ends in red, breaks winning streak: top stocks to play on every fall

NEW DELHI: The S&P BSE Sensex snapped three-day winning streak and slipped as much as 282 points in trade on Tuesday, led by losses in Tata Steel, JSW Steel, NMDC and Sesa Sterlite. The 30-share index witnessed the biggest single-day drop in nearly 6 weeks.

Tracking the momentum, the 50-share Nifty index also came under bit of pressure and closed the day below its crucial psychological level of 8500. The index hit a record high of 8535.35 earlier in trade today.

The S&P BSE Sensex has rallied over 33 per cent so far in the year 2014 and some sort of profit booking cannot be ruled out after three straight days of gains, say analysts but the broader trend remains on the upside.

The S&P BSE Sensex finally closed at 28,338.05, down 161.49 points or 0.57 per cent. It touched a high of 28,541.22 and a low of 28,217.50 in trade today.

The 50-share index ended at 8,463.10, down 67.05 points or 0.79 per cent. It hit a record high of 8,535.35 and a low of 8,429.45 in trade today.

According to analysts, after the recent rally, a correction is overdue and a 3-4 per cent fall will be healthy for the market. However, they don't expect the slide to be steep as retail investors are waiting on the sidelines to enter the market

"The markets do not go just one way up. So there will be pockets of corrections, but for investors it is not very important. We are in a very structural uptrend of the market and everybody agrees that India is in a sweet spot," says Porinju Veliyath, MD & Portfolio Manager, Equity Intelligence India.

"I do not expect more than 3% to 4% kind of correction. That will happen only if some real bad news comes in. It is difficult to say people missed the equity opportunity in India because they are not late. Yet, there is a lot of scope for them," he adds.

"If you want to be apprehensive or be cautious, there are a lot of elements. But looking at the sheer fundamentals of companies and valuations, nobody has missed that and it has just started," explains Veliyath.

Even though benchmark indices have outperformed most of the emerging market peers and indices across the globe, but analysts still advice investors to scout for value picks and buy them on every dips rather than chasing high beta names.

"To find value, one really needs to be stock specific in terms of following up a bottom-up approach," says Mayuresh Joshi, VP, Institution, Angel Broking.

"Investors should be ready to accumulate over the next few months at every significant dip into the market and they should add on to quality stocks and probably hold on for the next couple of years, which will make decent returns over the next two years," he adds.