Risk-on returns to stock markets; rate-sensitive begins rally

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Maruti leads auto rally, Sobha top gainer from realty

By S Jha

New Delhi, March 24: In three days, Nifty has netted gains of over 300 points. The fear factor has taken a backseat on the street. The US Federal Reserve lifted the Damocles’ sword on the street by asserting that three rate cust this year will indeed be on the card.

The rate sensitives are seen by market participants gaining steam on the street. The Bank Nifty has also spurted by almost 1000 points in three days. The Nifty is back in the 22k zone to give a major respite to the investors. Bank Nifty, as has been the trend for the last 18 months, remains a laggard.

Banking, auto, and realty stocks were in big demand on Friday. Telecom sector also led from the front. The steller show in the auto sector had ducked the sell-off of the last week also. Maruti Industries, India’s largest auto-maker, finally went past the level of Rs 12000. This is a major milestone for the shareholders of Maruti.

The market participants had a sense of disappointment with the largest automaker in the past. Peers such as Mahindra and Mahindra and Tata Motors had been on extended bull runs. But Maruti was giving up gains after a few days of rally on the street.

The share price of Maruti on Friday closed at Rs 12337. During the day, it had gone past even the level of Rs 12400. Maruti was among the top gainers of Nifty. Tata Motors was the only stock in Nifty to double last year. Mahindra and Mahindra is also now placed with sight on Rs 2,000.

Rate cuts as per market participants may bring cheers to auto and home buyers. Thus, the shares of such companies saw strong demand. Sobha led the pack with gains of over five per cent. Swan Energy also posted a gain of over six per cent. Diversified Swan Energy has a real estate arm with presence in Bengaluru and Mumbai. Prestige Estates and Brigade Enterprises closely followed Sobha. Over one year, the trend on the street shows the Bengaluru-based realty firms favourably placed.

Yet, Nifty IT was the top loser. This followed a sharp dip in the share prices of Accenture. The IT behemoth has lowered the revenue guidance. The knock-off effect was seen on the share prices of the Indian IT firms. The likes of TCS, Infosys, Wipro, and others felt the heat in the Friday session.

(Disclaimer: This article makes no recommendation for buy or sell of shares of any company)