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Market Movers: Banks lead charge for bulls as IT pack tumbles

MUMBAI: Shares of banks led the charge for the bulls on the Street as confidence grows over the sector to carry the baton in the coming months.

The Nifty Bank index surged 1.4 per cent in the session, outperforming every other sectoral index with money managers hinting that loan growth for the sector will pick up as the economy gets back on its feet.

Brokerage firm Nomura India on Monday said that the economic activity had returned to pre-second wave levels, which is usually good for lenders. While the entire banking pack had a swell session today, it was the private banks that stood out. Perhaps this time banks will be able to sustain the run and help the Nifty50 finally cross the 16,000 points barrier.

IT stocks are tripping

No, not in a good way. Shares of information technology companies have been under the hammer since the underwhelming June quarter earnings of the sector leader Tata Consultancy Services. With set to deliver its earnings on Wednesday, investors aren’t willing to place bets in the hope that the company will outshine .

Given the rich valuations of the sector and the substantial gains they have seen in the past 12 months, any more upside will be contingent on surpassing the market’s estimate for earnings. The Nifty IT index closed 0.3 per cent lower.

OFSS bucks the trend

While most IT services companies were painted in red, some did buck the trend. Oracle Financial Services Software surged nearly 3 per cent as investors bet on the company to be ahead of its peers when it comes to BFSI spending. The company is a leader in BFSI tech and with banks likely to open up their purse strings going ahead to keep up with more nimble technology rivals, OFSS can expect to see better days ahead in terms of deal wins.

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