No surprise then that even ITC was a gainer on a day when most other sectors experienced profit booking from cautious investors who did not want to take a chance on what Pivot Powell (Jerome Powell) might say later today.
Shares of FMCG stocks such as Tata Consumer Products, ITC,
, Asian Paints and were among the big gainers on the benchmark indices. However, to label their gains as investors’ preference for defensive bet will be an oversimplification. There is more than what meets the eye under this FMCG umbrella.
For starters, there is the hope of strong rural spending due to what has been a stellar beginning to the monsoon season (ask us: we haven’t seen the sun in days here in Maximum city). Secondly, even urban demand is slowly coming back with some surveys suggesting that FMCG sales are picking up as states are relaxing more and more restrictions.
Finally, the most important factor is that concerns around these companies’ margins are easing. Why? Because while you were busy laughing at the shareholders of Adani Group for comic relief, prices of several global soft commodities like crude palm oil — used as raw material by FMCG folks — were tanking just as fast as they went up earlier this year.
Yes, folks, boring is the new exciting (sometimes)!
Oil plumbers are in fashion
While soft commodities may be experiencing a harsh correction, there are no such concerns at the crude oil junction. Brent futures rose today and are threatening to move over the $75 per barrel mark and you know what that means (and no, it does not mean you will soon pay Rs 150 for your fuel). It means that our black-eyed boy ONGC was 1 per cent higher in a down market looking down upon steel stocks.
Should Adani Green get your sympathy?
Okay, hear us out. Right before the whole chaos around the foreign portfolio shareholders started on Monday, Adani Green Energy was on the verge of history. The largest company in Gautam Adani’s portfolio by market capitalization was a striking distance away from taking over Radhakishan Damani’s Avenue Supermarts.
If Adani Green surpassed the D-Mart owner’s market capitalization, it would have made it the highest valued non-Nifty50 stock in India. There goes a slice of history that the company may never get, especially, if D-Mart finds its groove again.
