IT bump not enough for Indian shares to shrug off HDFC Bank-led weakness
Indian IT stocks helped the benchmark indexes close higher on Friday, but not by enough to avoid a weekly loss after a three-session losing streak sparked by HDFC Bank's disappointing results earlier in the week.
The blue-chip index NSE Nifty 50 closed 0.75% higher to 21,622.60 points, while the S&P BSE Sensex ended 0.7% up to 71,683.23. They lost 1.24% and 1.22%, respectively for the week.
The benchmarks tumbled nearly 3% from Tuesday to Thursday, mainly due to HDFC Bank's slide following worries over its margins. Financial stocks slid 4.1% this week.
"Apart from banking, other sectors are still holding strong. So, I don't see any reason that the market would witness any major correction," said Ajit Mishra, senior vice president for research at Religare Broking.
On Friday, IT companies, which earn a significant share of their revenue from the United States, climbed after U.S. labour data bolstered hopes of a soft landing for the economy, adding to the optimism after IT bellwethers flagged green shoots of demand recovery.
The IT index closed 0.92% higher for the day and 1.5% for the week.
"The buoyancy in the IT majors, when banking is on the back foot, seems to be giving some comfort," Mishra said.
The more domestically focused small-cap and mid-cap indexes rose over 1% each on the day. The small-caps declined 0.37% for the week, while mid-caps rose 0.64%.
Among individual stocks, Aditya Birla group-owned UltraTech Cement closed 2% higher after its third-quarter profit beat analysts' expectations.
Hindustan Unilever ended 0.7% higher before reporting quarterly results. It missed analysts' quarterly profit expectations.
Index heavyweight Reliance Industries is due to report results after the bell.
