As the Indian stock markets step into 2026, investors are keenly observing expert recommendations to navigate potential opportunities. MarketSmith India, a well-regarded research platform, has released its stock picks for January 2, 2026, offering insights into promising stocks.

Market Performance Overview

The Indian equity benchmarks had a muted start to the new year. On January 2, 2026, the Nifty 50 settled at 26,146.55, showing a marginal increase, while the BSE Sensex edged down by 32 points to close at 85,188.60. Market activity was subdued due to global New Year holidays, resulting in thin liquidity and varied sectoral performance. The auto sector emerged as a leader, gaining over 1% driven by strong December sales figures, with IT and Realty sectors also showing steady gains. Conversely, FMCG stocks, particularly ITC, experienced a sharp decline due to increased tobacco excise duties.

Stock Recommendations

MarketSmith India has recommended buying shares of Fedbank Financial Services Ltd and Adani Energy Solutions Ltd.

• Fedbank Financial Services Ltd: MarketSmith India recommends this stock, citing its strong parentage and growth in lending.

• Adani Energy Solutions Ltd: The recommendation highlights the company's presence in the power sector and the backing of the Adani Group.

Previous Day's Recommendations (January 1, 2026)

On the previous trading day, MarketSmith India suggested buying Hindalco Industries Ltd and Fertilizers and Chemicals Travancore Ltd (FACT).

• Hindalco Industries Ltd: The recommendation was based on Hindalco's robust position in the aluminum and copper value chain, Novelis' leadership in flat-rolled products, and its potential to benefit from infrastructure, EV, and renewable energy demand. The suggested buy range was ₹880–892, with a target price of ₹980 and a stop loss at ₹840.

• Fertilizers and Chemicals Travancore Ltd (FACT): The rationale included FACT's strategic position as a Public Sector Undertaking (PSU) in fertilizers and chemicals, supported by agricultural demand and subsidies, along with its turnaround efforts. The buy range was ₹908–920, with a target price of ₹1,030 and a stop loss at ₹868.

Factors Influencing the Market

Several factors are expected to influence the Indian stock market in the coming days. India's Industrial Production data will be closely monitored for insights into economic momentum. Sustained foreign institutional investor (FII) selling has been a concern.

Market Outlook

The Nifty is expected to consolidate within a broad range of 25,700-26,300. A breakout above 26,300 could lead to further upside towards 26,500, while key support lies in the 25,700-25,800 zone.

Disclaimer: It is important to note that these recommendations are based on expert analysis and market trends at the time of publication. Investors should conduct their own research and consult with a financial advisor before making any investment decisions.