Markets pare gains as IT heavyweights drag

Wipro down 8.5% along with Infosys, TCS losing 1-2% dragged the IT index lower by over 2%

Markets pared some of its morning gains on account of increasing weakness in IT frontline names like Infosys, TCS and Wipro. At 1130 hrs, the Sensex was up 75 points at 19,092 and the Nifty gained 29 points to trade at 5,812 in late morning trades.

Meanwhile, the broader markets retained its opening gains, with the mid and smallcap indices up 0.5-0.6%, both outperforming the Sensex which was up nearly 0.4%.

Among the sectoral indices, Consumer Durables index gained over 3.5% followed by Bankex, Capital Goods, Metal and PSU indices up 1-2%. The only indices to remain in the negative was IT and Tech, down 1.5-2% owing to the weakness in It frontline stocks.

The ones leading the gains in the Consumer Durable space were Titan Industries up over 5%, Gitanjali Gems, Videocon Industries and VIP Industries which advanced 1.5-3.5%.

The banking space gained ahead of the RBI meet on May 3rd on hopes of a rate cut by the RBI. SBI, Axis Bank, Bank of India, Canara Bank, HDFC Bank and ICICI Bank which added 1.1-3.6% were the major gainers.

On the other hand, IT stocks continued to tread on a slippery ground. Wipro down 8.5% was the top loser following the weak revenue guidance they put forth during the Q4 result announcement. Infosys, TCS and HCL Tech too were in the negative, losing 1-2%.

The other major Sensex-30 losers were Dr Reddys Lab, Mahindra & Mahindra, ONGC, Cipla and Bajaj Auto down 0.4-2%.

On the gaining side were Coal India, L&T, Hero MotoCorp, Tata Steel, BHEL, Sun Pharma, HDFC, NTPC and Tata Motors up 1-4%.

The market breadth was positive. 1075 stocks advanced while 824 stocks declined on the BSE.