Muhurat trading: Experts favour selective buying, caution against aggressive bets

New Delhi: Investors and traders should adopt a cautious, stock-specific approach during the annual Muhurat trading session on Sunday which marks the beginning of Samvat 2083, as equity benchmark indices approach key resistance levels and limited liquidity could amplify market movements, market experts said.

The special Diwali trading session is traditionally considered auspicious for initiating investments and reviewing financial portfolios.

However, the market experts cautioned against making impulsive decisions driven by festive sentiment, recommending that investors focus on fundamentals, valuations and long-term financial goals.

Meanwhile, long-term investors can use the occasion to review asset allocation and selectively accumulate fundamentally strong stocks, short-term traders should monitor technical levels and global cues before taking positions, they added.

Analysts at domestic brokerage Motilal Oswal Financial Services (MOSL) said Nifty valuations were attractive at 17.5 times forward earnings, around 16 per cent below the long-term average, although small-cap stocks continued to trade at a 25 per cent premium to their historical average.

The brokerage has expected earnings growth to recover in the coming years with Nifty earnings per share projected to rise 16 per cent and 14 per cent year-on-year in FY27 and FY28, respectively, compared with 5 per cent in FY26.

For Samvat 2083, the experts favours banking and financial services, capital markets, manufacturing, global outsourcing and exports, consumption and digital businesses.

Similarly, they see opportunities in healthcare devices, aerospace, auto components, pharmaceutical ingredients, garments, port cargo, organised jewellery and quick-commerce platforms.

Investors should avoid large orders and aggressive trading during the limited Muhurat session, given the possibility of lower liquidity, the experts said.

For new investors, the experts said consider small investments in fundamentally strong companies with a long-term holding perspective, while avoiding stocks bought solely because of the auspicious occasion.

They expect the market to remain sideways to consolidative during the Muhurat session with both benchmark indices approaching crucial resistance zones after a recent rally. Trading around 24,600, Nifty has immediate support at 24,350, while resistance is placed in the 24,700-24,800 range.

They cautioned that profit booking could emerge following six consecutive sessions of gains, particularly amid geopolitical concerns, crude oil volatility and weakness in global markets.

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