Sector Watch: IT Leads Rally as HCL Tech, TCS Jump While Metals Melt as Hindalco, NALCO Decline

Mumbai, June 16: Indian equities extended their gains for a third consecutive session on Tuesday, with sectoral participation remaining broadly positive as easing geopolitical tensions in the Middle East and lower crude oil prices improved risk appetite. Eleven of the 16 major sectoral indices ended in the green, helping the Nifty close just shy of the 24,000 mark.  

IT Stocks Emerge as Top Performers 

Nifty IT index grew wings as stocks soared after Iran peace deal. Source: NSE 

Information technology stocks led the market higher, with the Nifty IT index rising more than 1%. 

Heavyweights such as HCL Technologies, Tata Consultancy Services and Wipro attracted buying interest as investors turned optimistic about the global growth outlook after the preliminary U.S.-Iran peace agreement eased concerns over a prolonged energy shock. Lower oil prices are also seen as supportive for major economies, potentially reducing pressure on corporate technology spending.  

HCL Technologies was the top gainer on the Nifty 50 during the session. HCL Technologies share price rose 3.5%, Tata Consultancy Services share price advanced 1.7% and Wipro share price edged up 0.7%. 

FMCG Gains on Softer Inflation Expectations 

FMCG stocks also witnessed strong buying as falling crude oil prices strengthened expectations of easing inflationary pressures. 

Nifty FMCG index flew as crude crash inspired purchasing confidence among traders. Source: NSE  

Tata Consumer Products and Hindustan Unilever were among the top Nifty gainers. Lower energy and transportation costs could help support margins for consumer companies while also boosting household spending power. 

Tata Consumer Products share price rose 2.8%, the increase also aided by global brokerage Citi reiterating its positive stance on the FMCG major. The brokerage cited steady demand momentum, strong growth prospects and potential for further margin expansion as key factors underpinning its constructive outlook on the stock. 

The Nifty FMCG index ended among the day’s best-performing sectoral gauges.  

Metals Under Pressure 

Metal stocks were among the few laggards as easing Middle East tensions reduced fears of commodity supply disruptions. 

Hindalco Industries, Vedanta Aluminium Metal and NALCO declined after global aluminium prices retreated sharply. Investors unwound positions that had benefited from concerns over disruptions to Middle East supply chains and shipping routes.  

Hindalco Industries share price declined 3%, Vedanta Aluminium Metal share price fell 5% and NALCO declined 4%. 

The Nifty Metal index ended in the red, making it one of the day’s weakest sectoral performers. 

Auto, Pharma and PSU Banks Lag 

While the broader market remained positive, auto, pharma and PSU banking stocks underperformed. Profit booking in select names kept these indices in negative territory even as benchmark indices posted strong gains. 

Nifty Auto index dragged markets with Tata Motors Passenger Vehicles failing to rise despite company commentary outlining ambitious plans and involving billions of rupees. Source: NSE 

Notably, Tata Motors Passenger Vehicles share price declined on Tuesday even as the company outlined ambitious growth and profitability targets, saying it aims to capture an 18–20% share of the domestic passenger vehicle market and achieve a double-digit operating margin. The automaker also said it plans to invest billions of rupees across its passenger vehicle and electric vehicle businesses to support future growth and strengthen its market position. 

With foreign investors turning net buyers after a prolonged selling streak and crude oil prices remaining subdued, market leadership has shifted toward sectors expected to benefit from improving macroeconomic conditions, particularly IT, consumption and domestic cyclical plays. 

Energy Stocks Gain as Crude Prices Retreat 

Energy shares remained in focus after Brent crude stayed near $82 per barrel following Monday’s nearly 5% slump. 

The prospect of lower fuel costs boosted stocks such as NTPC, while gas-related companies gained on expectations of improved LNG supplies after the anticipated reopening of the Strait of Hormuz. Petronet LNG gained 1.6% while GAIL edged up 0.4% over optimism related to LNG. Reliance Industries rose 1.7% ahead of its AGM this week. 

Lower oil prices are viewed as a significant positive for India, the world’s third-largest oil importer.  

Realty, Consumer Durables Extend Rally 

Real estate stocks continued their recent outperformance, with the Nifty Realty index climbing more than 2%. 

The sector benefited from improving market sentiment, stable domestic interest rates and expectations that lower oil prices could help keep inflation under control. Consumer durables shares also advanced as investors increased exposure to domestic demand-driven themes.  

Source

•  NSE