Indices ride high on surge in tech stocks

Propelled by gains in technology stocks the benchmark indices rose on Thursday, despite a more than two per cent drop in index-heavyweight Reliance Industries (RIL).

The Sensex rose 393 points, or 0.75 per cent, to end at 52,699, while the 50-share Nifty gained 104 points, or 0.7 per cent, to close at 15,790. The BSE IT index rose 2.92 per cent, the most among the sectoral indices.

The top four gaining stocks on the Sensex were all from the tech sector. Infosys gained the most at 3.75 per cent, followed by TCS (3.42 per cent), Tech Mahindra (2.23 per cent), and HCL Tech (1.85 per cent). The four stocks made a 323point contribution to the index. Shares of RIL fell 2.35 per cent after the announcements at its annual general meeting. It dragged the Sensex lower by 152 points

Analysts said Accenture’s third-quarter revenue figures boosted sentiment towards the tech pack. The IT consulting firm’s revenue rose to $13.3 billion in the quarter ended May 31 from $11 billion a year earlier, beating Street expectations. “With June quarter drawing to a close next week, technology stocks powered indices. The Street is betting on the IT sector to deliver an encouraging set of earnings,” said S Ranganathan, head of research at LKP Securities.

Earlier this week, sentiment was boosted by the surging pace of vaccination in the country, stoking optimism of a faster economic revival.

Market players, however, said rising crude and fuel prices could prove to be headwinds for the market. “Markets are looking comfortable as of now,” said Sandeep Jain, a strategist with Tradeswift Broking. “Rising crude prices and inflation are major overhangs for Indian equities,” he said, adding that investors will continue to focus on the ramp-up of vaccination and decrease in virus cases in the country.