Sensex’s costly exclusion
Tata Steel will make a comeback to the benchmark Sensex within six months of its exclusion. Market watchers say this could be a record for a stock in terms of quick exit and entry into a benchmark index. In December 2020, the Tata group firm was replaced by Dr Reddy’s in the 30-share blue chip company index. The exclusion proved costly to investors, particularly those investing in Sensex-based exchange traded funds (ETF) and index funds. Tata Steel is up nearly 80 per cent since December 23, when it was removed from the index. “This is akin to shorting the stock around Rs 600 levels and covering your short position at Rs 1,100,” quipped an analyst.
Hospitality stocks up on unlock hopes
Shares of restaurant and hotel companies are seeing an uptick on optimism that the declining Covid-19 caseload will lead to easing of lockdown measures. Stocks of Westlife Development, Speciality Restaurants, Taj GVK, India Hotels, and Burger King India are among the stocks in this space that saw huge buying interest last week. Market players said investors are lapping on to these stocks as they see the “revenge spending” phenomenon play out after several weeks of lockdown gets eased in key cities like Mumbai. However, some analysts believe it is too soon to say whether these companies will see a strong revival in their businesses even if lockdowns are lifted. "The second wave being more lethal has induced fear among many. People are not going to step out and dine till they get their second jab," said an analyst.
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