From 12,168 To 7,511 And Back: Mapping The Nifty’s Journey In 2020
The NSE Nifty 50 erased all the pandemic-driven loss of the year to trade positive, led mainly by a surge in pharma and technology stocks, and the index heavyweight Reliance Industries Ltd.
The index closed at 12,224 on Jan. 20, after scaling to a 52-week high of 12,430 intraday. Then the Covid-19 outbreak and subsequent lockdowns triggered fears, roiling global markets. Within two months, the index tumbled 40% from its record high to a 52-week low of 7,511 on March 24.
Since then, the 50-stock index saw a one-way rebound. Even when India was reporting more than 90,000 new Covid-19 cases every day in early September didn't disrupt the recovery.
Defensives On The Charge
Among the top 10 gainers on the Nifty this year, three are pharma stocks, four IT counters and the remaining three Reliance Industries, Asian Paints Ltd. and JSW Steel Ltd.
Not Everything’s Green
Despite the sharp recovery from its 52-week low, only 23 index constituents have managed to turn positive for the year.
Six of the worst 10 laggards in the index are public sector companies.
Reliance Industries and Infosys are the top two stocks that drove the index. Reliance Industries has contributed 349 points to the rebound and Infosys 337. TCS is a distant third with 136 points. These are the only three stocks that made a three-digit contribution to the upside this year.
ICICI Bank is the top contributor to the downside, with 159 points. HDFC Ltd., IndusInd Bank Ltd., Axis Bank Ltd., State Bank of India and ITC Ltd. contributed more than 100 points in loss each.
No Silver Lining For Sectoral Indices...As Yet
IT and pharma have been the outperformers of the year. While the Nifty IT Index gained 37% this year, pharma index is the top performer with 46% returns. The FMCG index is the only other sectoral gainer with gains at 0.2%.
While all constituents of the Nifty IT and Nifty Pharma have gained year-to-date, none of the constituents on the Nifty Bank, Nifty PSU Bank and Nifty Realty have managed to turn positive despite the recovery from their respective 52-week lows. The PSU Bank index is the worst performer, tumbling 46% so far this year.