Indian shares inch higher in thin trading as IT, pharma gain

BENGALURU — Indian shares edged up on Thursday in thin trading as information technology and pharma sectors gained, while the country reported the highest jump in daily coronavirus cases in a month.

The NSE Nifty 50 index was up 0.2% at 17,245 by 0525 GMT and the benchmark S&P BSE Sensex rose 0.18% to 57,911.10.

“The strong growth dynamic in the Indian IT sector and the status that pharma enjoys will ensure that money gravitates towards these sectors till there is clarity on Omicron fears,” said Ajay Bodke, an independent market analyst.

The Nifty IT index gained 0.9% and the pharma index added 0.55%.

The IT index has gained for a fifth straight week and is up over 59%, so far this year.

“We believe IT sector is in a multi-year upcycle due to robust demand environment, strong deal momentum, healthy deal pipeline and acceleration of digitalisation across all the sectors,” Mohit Nigam, head, portfolio management services, Hem Securities said.

Indian equities have retreated more than 7% from a record peak hit in October on worries over high valuations and the spread of the Omicron variant of COVID-19 across the globe. India reported a daily rise of 13,154 in COVID-19 cases.

“The rate of hospitalisations from Omicron is very low. But, if the sheer numbers were to overwhelm the hospital infrastructure, then one could see rollout of lockouts and crimping of economic activity,” Bodke said.

Among individual stocks, RBL Bank fell 8% after a report said that a 3 billion rupees write off was the key reason for India’s banking regulator’s intervention in the private lender.

RBL said over the weekend that its managing director and chief executive officer went on medical leave and the Reserve Bank of India had appointed an executive to the lender’s board. (Reporting by Nallur Sethuraman in Bengaluru; Editing by Vinay Dwivedi)