Over half of BSE 500 stocks underperform market in July
New Delhi, July 31
More than half of the BSE 500 basket stocks underperformed the broader market in July, with 280 companies posting declines of up to 22 per cent despite benchmark indices ending the month in positive territory.
According to exchange data, the underperforming stocks accounted for nearly 87 per cent of the total market capitalisation of BSE-listed companies and recorded gains of less than 1 per cent during the month.
While BSE Sensex, BSE 500 and BSE Midcap indices gained between 1 per cent and 2 per cent, the BSE Smallcap index slipped 0.1 per cent.
Moreover, Nifty 50, Nifty Midcap 100, Nifty Smallcap 100 and Nifty 500 indices also ended July higher, rising between 1.4 per cent and 2.1 per cent.
Among the major losers, Dr Reddy's Laboratories, Bandhan Bank, Thermax, Tejas Networks, Suzlon Energy, GE Vernova T&D India, Siemens Energy India and Gujarat Energy declined between 15 per cent and 20 per cent during the month.
Many analysts attributed the outperformance of select stocks to better-than-expected June-quarter earnings and renewed buying in information technology shares.
The BSE Information Technology index was the top-performing sector, rising 16 per cent, followed by Nifty Consumer Durables -- 9.4 per cent, Nifty Realty -- 8.4 per cent and Nifty Auto -- 5.9 per cent.
Additionally, foreign portfolio investors (FPIs) turned net buyers during July, investing Rs 15,412 crore, ending a four-month selling streak, while domestic institutional investors (DIIs) remained supportive with net inflows of Rs 32,839 crore, helping benchmark indices stay resilient despite broad-based weakness in individual stocks.
On Friday, domestic equity benchmarks extended their gains for a third consecutive session amid buying in auto and financial services stocks.
Sensex settled 166.49 points or 0.21 per cent higher at 78,094.64, while Nifty ended 66.45 points or 0.27 per cent up to close at 24,383.60.
— IANS
Reader Comments
This is why I stick to SIPs and don't panic. The FPI money coming back after 4 months is a good sign though. But honestly, the divergence between largecaps and smallcaps worries me. Hope the government's capex push helps the broader market next quarter.
Suzlon and Tejas Networks falling 15-20%? Investors who chased the momentum are crying today. This is exactly why we say - jiska kaam usi ko sajhe, aur jo stock samajh na aaye usse door raho. FIIs returning is positive, but retail investors need to be more careful with thematic bets.
Living in the US and following Indian markets is fascinating. The DII support at Rs 32,839 crore shows domestic investors are maturing. But the concentration risk in IT and a few sectors is concerning. I'd like to see more broad-based participation. Also, Dr Reddy's falling 15% despite health sector being resilient - quite unusual.
At 78,000+ Sensex, valuations are stretched. The fact that 87% of market cap stocks gained less than 1% while indices rose tells me it's a narrow rally. Middle-class investors like us should wait for the earnings season to fully unfold. Better to hold cash than chase every high. As they say, dheere dheere chalna seekho.
Interesting data. The IT sector surge of 16% seems like a good sign for Indian tech exports. But I'm surprised consumer durables outperformed at 9.4% - either urban demand is really picking up or rural India is quietly recovering. Time will tell if this is sustainable or just a pre
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