Defensive sectors such as fast moving consumer goods (FMCG), information technology (IT) and pharmaceuticals are losing sheen as investors shift their focus to infrastructure-related sectors.
HCL Technologies, Tata Consultancy Services (TCS), Infosys and Wipro from the IT space, Sun Pharmaceutical Industries, Divi’s Laboratories, Dr Reddy’s Laboratories and Ranbaxy Laboratories from pharma, and ITC, Hindustan Unilever and Colgate Palmolive from FMCG sector are down 2-6% each on the Bombay Stock Exchange (BSE).
All these three sectoral indices are down 3-5% compared to a 0.59% rise in the benchmark index S&P BSE Sensex. At 1140 hours, the S&P BSE IT index is down nearly 5%, followed by S&P BSE Healthcare (3.9%) and S&P BSE FMCG (2.8%).
Shares of IT and pharma are reeling under pressure after the rupee hit a 11-month high against the dollar today. A firm rupee adversely affects operating profit margins of IT firms as the sector derives a lion's share of revenue from exports.
HCL Technologies, Tata Consultancy Services (TCS), Infosys and Wipro from the IT space, Sun Pharmaceutical Industries, Divi’s Laboratories, Dr Reddy’s Laboratories and Ranbaxy Laboratories from pharma, and ITC, Hindustan Unilever and Colgate Palmolive from FMCG sector are down 2-6% each on the Bombay Stock Exchange (BSE).
All these three sectoral indices are down 3-5% compared to a 0.59% rise in the benchmark index S&P BSE Sensex. At 1140 hours, the S&P BSE IT index is down nearly 5%, followed by S&P BSE Healthcare (3.9%) and S&P BSE FMCG (2.8%).
Shares of IT and pharma are reeling under pressure after the rupee hit a 11-month high against the dollar today. A firm rupee adversely affects operating profit margins of IT firms as the sector derives a lion's share of revenue from exports.
The rupee has jumped to its strongest in 11 months against the dollar on expectations of continued robust foreign buying in domestic shares and debt after the Narendra Modi-led Bharatiya Janata Party swept the country's elections.
Analysts believe that infrastructure shares will benefit from Narendra Modi's pro-business approach.
There is well-grounded expectation that the new government will usher in strong pro-reform policies and kick-start the investment cycle.
Among individual stocks, TCS has tanked 6% to Rs 2,032, while Sun Pharma, Infosys and ITC have plunged 5% each on the BSE.