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Beaten down stocks rally on vaccine hopes as IT & pharma sell off

Beaten down stocks rally on vaccine hopes as IT & pharma sell off

New Delhi, Nov 10 (SocialNews.XYZ) As the stock markets touch new highs rising for the seventh consecutive session, it is the beaten down sectors that are rallying while the stay at home themes like IT and pharma are taking a beating.

Devarsh Vakil, Deputy Head of Retail Research, HDFC Securities said IT and Pharmaceuticals stocks corrected while stocks that have been beaten down by the severe disruption of the pandemic, such as those tied to travel and leisure, movie theatres, and theme parks, along with some retailers and restaurants led the markets higher.

 

Indian markets shot-up on positive over-night cues from global markets. Investors cheered as a trial of a Covid-19 vaccine developed by Pfizer Inc. and BioNTech SE showed more than 90 per cent effectiveness.

Vakil said Markets had closed at all time highs on Monday and handsomely built on those gains during Tuesday's session. "Today was the seventh consecutive session where benchmark indices have closed in the green. Banking stocks continued to outperform, as bank nifty made a massive 4 per cent up move today."

S. Ranganathan, Head of Research at LKP Securities said the bulls went on a rampage on Tuesday buoyed by positive global cues and the 1.5 per cent rise in Indices reflected the buoyant mood ahead of the festive season.

He added that financials went berserk well supported by heavy weights across sectors barring pharmaceuticals which witnessed profit booking.

Vinod Nair, Head of Research at Geojit Financial Services said the global financial markets experienced a wave of euphoria over the potential breakthrough in the coronavirus vaccine development. Indian indices moved in sync with global peers touching fresh highs with continued support from banking stocks while IT and Pharma sectors witnessed heavy sell-offs.

Nair said an uptick in beaten down stocks and sectors were visible on Tuesday viewing hopes of recovery in business. The existing momentum can sustain on vaccine development, domestic stimulus package, consistent FII inflows and bounce in globalization post the Biden victory.

"However, temporary correction due to profit booking cannot be ruled out because the market is highly optimistic that the vaccine development will rapidly improve the ground reality", he added.

Santosh Kumar Singh, Head of Research, Motilal Oswal Asset Management Company added, "Markets are at all-time high, however they are driven by three news flows a) US elections uncertainty over b) COVID Vaccine may be much closer and c) India recovery has been faster. Hence, the markets may not see big correction from here and in the medium to long term we see markets doing well. In my view financials is still an area where good upside may be left with all the banks reporting better credit quality."

Source: IANS

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Beaten down stocks rally on vaccine hopes as IT & pharma sell off

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