With the expectations of a turnaround in economy and pick up in investment in infrastructure projects growing following the election of Narendra Modi-led BJP to power, investors are shedding their over dependence on export earning IT and pharma counters and have started to look increasingly inward at the growth sectors in India.
While IT and pharma stocks emerged as some of the biggest losers, others particularly banks, metals, capital goods and infrastructure-related stocks continued to soar, indicating a clear shift in investor preference this morning.
What was adding to the investors’ preference was the continued rise in the value of the Indian rupee against the US dollar as Indian exporters would lose their edge in the global markets.
The CNX IT index was down by over 430 points and all the frontline IT stocks were reeling. In fact, of the 20 stocks in the IT index, 17 were down, reflecting the change in the mood of the investors. The biggest losers among the top IT stocks were Infosys which was down by Rs 162.55 to Rs 3,015 followed by TCS that shed Rs 116.75 to trade at Rs 2,044.
MindTree shed Rs 82.50 to trade at Rs 1,305 and interestingly, the stock is trading cum-bonus (at 1:1 ratio).
HCL Tech lost Rs 86.15 to Rs 1,279 and Persistent Systems was trading at Rs 904.30, a loss of Rs 74.65. Wipro shed Rs 23.90 to trade at Rs 478.90.
The only gainers were Naukri, Justdial and Vakrangee.
The pharma stocks also were trading in the red but the extent of value erosion was not uniform. The biggest loser was Dr Reddy’s, down by Rs 106.90 at Rs 2,300 and Divis Lab shed Rs 72.65 to trade at Rs 1,229.80.
Sun Pharma lost Rs 38.40 to trade at Rs 575.10, Ranbaxy was down by Rs 21.85 to Rs 430.30 and Lupin, Glenmark and Cadila were the other significant losers.
All the 10 stocks in the CNX Pharma index were down.
The CNX Nifty showed stocks in sectors closely linked to economic development like banks, power, oil and gas, metals and minerals all in demand.
Coal India shot up by Rs 30.60 to Rs 376, BPCL jumped by Rs 32.20 to Rs 584.30, L&T zoomed by Rs 72 to Rs 1,499.70, SBI and PNB touched new 52-week highs and auto stocks such as Maruti, Hero Motocorp shrugged off any slowdown blues. Cements stocks like ACC and UltraTech also were in demand.