Sensex, Nifty erase early losses; IT stocks sustain pressure
Indian shares recovered from early losses to trade slightly higher on Friday, with gains in the financial and consumer sectors eclipsing losses in large-cap IT stocks.
The broader Nifty, which fell as much as 0.5 percent in early trade, was up 0.16 percent at 10,615.8 as of 0545 GMT. The benchmark Sensex was 0.12 percent higher at 35,280.59.
The indexes were set to finish the trading week, truncated due to local holidays, about half a percent higher.
In broader Asia, stocks pulled back from one-month high as the U.S. Federal Reserve appeared poised to deliver another interest rate hike next month.
“We don’t have much of a positivity from Asia…volatility is also slightly up, being the last working day of the week,” said Anand James, chief market strategist at Geojit Financial Services.
Indian shares appeared to shrug off weak leads from its neighbours, led by Asian Paints Ltd’s stock that rose as much as 4.6 percent to a six-week high. The stock was also the top percentage gainer and contributor to the NSE index.
Private-sector lender Axis Bank Ltd climbed 2.4 percent, while smaller rival Yes Bank Ltd rose as much as 4.4 percent in its ninth straight session of gains.
Auto stocks also saw good buying interest. Shares of Maruti Suzuki India Ltd rose 2.6 percent, while those of Tata Motors Ltd climbed 3 percent to a one-month high.
Industrial gases company Linde India Ltd surged as much as 19 percent after its biggest shareholder said it intended to buy the rest of the company.
Telecom equipment manufacturer ITI Ltd jumped 9.4 percent after the Indian government said it will continue to force three state-owned telecom companies to buy 30 percent of their equipment orders from ITI.
The pharmaceutical sector got a boost from a weaker rupee that hit a day’s low of 72.8225 against the dollar.
The Nifty Pharma index rose as much as 1.5 percent, lifted by a 3.4 percent jump in Sun Pharmaceutical Industries Ltd.
However, the weak rupee failed to cheer large-cap IT stocks, as shares of Infosys Ltd and Tata Consultancy Services Ltd fell 2.4 percent and 1.6 percent, respectively.
Telecom major Bharti Airtel Ltd was the biggest percentage loser, with shares dropping as much as 5.7 percent after rating agency Moody’s on Thursday placed the company’s credit rating on review for downgrade citing low levels of profitability and expectations of weak cash flow.