Breakout Stocks: Nifty FMCG hits record highs! How to trade Britannia Industries and ITC on Friday?

Indian market recouped losses and closed in the green on Thursday. The S&P BSE Sensex rose nearly 100 points while the Nifty50 closed above 18,300 levels on the May F&O expiry day.

Sectorally, buying was seen in telecom, realty, capital goods, and FMCG stocks while some profit-taking was seen in metal and energy stocks. Nifty FMCG index hit a fresh record high of 49,825 in intraday trade on Thursday. The BSE FMCG index also hit a record high.

The Nifty FMCG Index is designed to reflect the behavior of Indian companies from the (Fast Moving Consumer Goods) (FMCG) sector. Over 20 years of historical data suggest that whenever the broader market is undergoing a correction, FMCG stocks have done comparatively better.

“While FMCG has its own growth story in India, it gets further impetus when NIFTY is largely undergoing a correction. One of the strongest examples is the period of 2008-13, when NIFTY was in a corrective period, whereas FMCG Index outperformed NIFTY by miles,” Piyush Chaudhry, Trader told ETMarkets.

“The correction in the broader market fuels the rally in FMCG stocks. Therefore, from the historical standpoint, the current phase of sideways NIFTY since October 2021 Highs is a positive for FMCG stocks,” he said.

“NSE’s FMCG Index from 2020 lows could well be in a rising Impulse. We see a good possibility of the Index reaching up to 60-65k in the period of the next 12-18 Months. Though less likely, the scenario would be considered invalid on a break below 42k,” recommended Chaudhry.

We have collated a list of three stocks that either saw a volume or a price breakout. We spoke to various experts on how one should trade these stocks the next day:

Expert: Manas Bhudiraja, Swing & Day Trader, Co-founder, tradingmonks to ETMarkets.com

Britannia Industries
For the next 2-3 days, 4570 would be crucial for Britannia and acceptance above it would take the price to 4680-4700 and further to new 52-week high.

ITC
It has been in a continuous uptrend and will continue to do so. We can also take part in this rally from the zones of 432 as we must wait for a Pullback for the next 2-3 and add it to the much better zone.

(Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of Economic Times)