Indian benchmark indices ended Friday's session on a strong note, outperforming most Asian markets as robust buying in information technology and financial stocks offset concerns over rising crude oil prices and geopolitical tensions in the Middle East. Investors largely focused on the ongoing June-quarter earnings season, with encouraging corporate results boosting market sentiment.
Indian equity benchmarks traded sharply higher in afternoon trade on Friday, with the Sensex rising 912.74 points, or 1.18%, to 78,099.61, while the Nifty climbed 248.10 points, or 1.03%, to 24,320.85. The gains pushed the Nifty above the 24,300 mark, reflecting broad-based buying across sectors.
The IT sector took center stage in Friday’s rally as Tech Mahindra delivered better-than-expected quarterly results, resulting in buying sentiment in technology-related stocks. Shares of Infosys, HCL Technologies, and Tata Consultancy Services rose, given the belief that the quarter is likely to mark a turning point for the underperforming sector. Banks were also strong, with Jio Financial Services jumping on better-than-expected quarterly results, as well as on loan growth estimates for Reliance Industries prior to its Q1 results.
| Stock | Sector | Reason for Move |
|---|---|---|
| Jio Financial Services | Financial Services | Strong Q1 earnings boosted investor sentiment |
| Reliance Industries | Oil & Gas/Conglomerate | Gained ahead of Q1 earnings announcement |
| Tech Mahindra | IT | Rose after reporting better-than-expected quarterly results |
| HCLTech | IT | Advanced on positive business developments and strong IT buying |
| Infosys | IT | Benefited from sector-wide buying interest |
| HDFC Bank | Banking | Rose on healthy loan growth expectations ahead of earnings |
| ICICI Bank | Banking | Gained on upbeat business update and earnings optimism |
| Kotak Mahindra Bank | Banking | Buying interest lifted the stock alongside private banks |
Wipro came off to a poor start as its quarterly earnings fell short of expectations and the management hinted at a delayed-than-anticipated demand recovery. Another company that took a severe beating was tire maker CEAT due to weak earnings performance. Some of the pharma and metals sector companies were also under selling pressure, with Cipla, Dr. Reddy's Lab and Hindalco ending on a negative note.
| Stock | Sector | Reason for Move |
|---|---|---|
| Wipro | IT | Fell after Q1 earnings missed Street estimates and weak outlook |
| CEAT | Auto Ancillary | Declined sharply after disappointing quarterly results |
| Cipla | Pharmaceuticals | Profit booking weighed on the stock |
| Dr. Reddy's Laboratories | Pharmaceuticals | Pharma sector remained under pressure |
| Hindalco | Metals | Weakness in metal stocks dragged shares lower |
| Sun Pharma | Pharmaceuticals | Declined amid selling in pharma counters |
| Bharti Airtel | Telecom | Witnessed mild profit booking |
| Apollo Hospitals | Healthcare | Traded lower along with healthcare stocks |
According to market analysts, corporate profits and management's view on those should keep driving the stock market movement in the coming weeks. In spite of high oil prices and geopolitical instability being important factors that could affect the stock market, market participants would be watching how companies perform during their quarterly earnings season.
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The Indian equity market closed on a bullish note despite staying confined in a range during the July 13 to 17 week owing to a confluence of factors such as uncertainties in the global economic environment and expectations of earnings from the companies in India. The Sensex and the Nifty stayed in a tight range during the week as the traders were weighing strong corporate performance in Q4 June against the rise in the prices of crude oil and tensions in the Middle Eastern region.
The week started with a volatile session on Monday as the major indices managed to recover from the loss seen at the start of the session due to the strong performance of IT sector stocks because of earnings results and some significant deals. Meanwhile, the rally on Friday, led by stocks such as Reliance Industries, Jio Financial Services, Tech Mahindra, and the private banking stocks, boosted the major benchmarks.
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