Stock Market: PLI theme brings good tide for chemical sector

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By S Jha

New Delhi, August 1: The indices stayed in the sideways mode amid investors keeping fingers crossed on the outcome of the monetary policy committee meeting of the Reserve Bank of India this week. The Nifty and Bank Nifty closed the day with cuts, while trading in narrow ranges.

Bank Nifty was under the pressure, with most of the constituents taking cuts. It was the solo effort of the HDFC Bank which kept the index protected against deep cut. HDFC Bank for the past two trading sessions is showing strength even while the crip is trading below its recent high of Rs 1700.

The bid of the Tech Mahindra to shore up its leadership positions by poaching the top talents of the Infosys once more gave strength to the IT major on Tuesday. Tech Mahindra led the IT pack on Tuesday even while several IT firms traded positively after the US economy reported better growth numbers than the expectations of the street.

HCL Technology also gained strongly amid signs that the Noida-based IT major is emerging as the leader of the Nifty IT. TCS, LT Technology, Birlasoft and others gained from the IT pack on Tuesday.

The PSU index continues to outperform the market. It was the turn of Coal India to shine on Tuesday. Coal India has not taken part in the recent rally, and the scrip gained almost five per cent on Tuesday. Along with NTPC, Coal India was the index leader on Tuesday. NTPC trailing its quarterly result touched the level of Rs 226 on Tuesday, making a decent gain of over 13 per cent in the last four sessions.

The power sector was also buzzing and even the penny stocks from the sector were rising in the market. While Tata Power led the show from the sector, even the likes of Reliance Power, a forgotten scrip, was up along withs several penny stocks from the sector.

The China reopening theme had apparently battered the chemical sector as several of the leading firms were trading at their lows for several months. But the government recently said that the PLI scheme would be brought for the sector, which spurred the chemical firms on Tuesday. The likes of Navin Fluorine, Atul Limited, SRF, Aarti Industries were among the gainers on the street. The chemical sector firms are relatively trading at lower Pes, which make them attractive for the investors even though China remains a major risk factor for them.