India’s Nifty begins 2024 with weekly losses as IT drags

By Bharath Rajeswaran

BENGALURU (Reuters) -India’s benchmark indexes posted marginal gains on Friday but logged losses for the week, dragged by high-weightage information technology stocks on weak earnings outlook and fading hopes of early U.S. rate cuts in 2024.

The NSE Nifty 50 fell 0.09% this week, while the Sensex shed 0.30%.

For the week, IT stocks fell 1.87% after fresh U.S. data and Federal Reserve policy minutes dampened expectations of early interest rate cuts in the United States.

Brokerages expect IT companies, which earn a significant share of their revenue from the U.S., to post weak quarterly earnings due to consistent weakness in client spending.

The auto index shed 1.13% this week, as a drop after mixed monthly sales data and tax demands for companies including Eicher Motors and Mahindra and Mahindra earlier in the week weighed.

“Markets are likely to see further consolidation ahead of results as the rise in the last two months of 2023 was too rapid,” said Saurabh Jain, assistant vice president of research of retail equities at SMC Global Securities.

Metal stocks lost 1.33% on concerns over China’s economic recovery and a firm U.S. dollar.

A stronger U.S. dollar makes metals more expensive for buyers using other currencies. [MET/L]

Realty stocks bounced 7.83%, marking their best week in two months, supported by strong quarterly updates from key constituents like Macrotech Developers, Sobha and Oberoi Realty and robust sales outlook.

On the day, the blue-chip Nifty 50 rose 0.24% to 21,710.80, while the S&P BSE Sensex added 0.25% to 72,026.15 as IT stocks recouped some of the weekly losses ahead of quarterly results.

Adani Ports and Special Economic Zone gained 2.76% on Friday, taking its weekly gains to 12.68%, the highest among Nifty 50 stocks.

Kotak Institutional Equities and HSBC hiked the target price of the ports and logistics company’s shares, citing factors including strong earnings outlook.

(Reporting by Bharath Rajeswaran in Bengaluru; Editing by Sohini Goswami and Sonia Cheema)