Top sectoral index performer: Nifty Pharma

The index is up over 0.5% today and is one of the top sectoral index performers.

The NIFTY Pharma Index is designed to reflect the behaviour and performance of the pharmaceutical sector in India. The index consists of 20 pharmaceutical stocks and the rescheduling of index constituents happens bi-annually every year. Sun Pharma and Divi’s Laboratories are the index heavyweights and hold about 19.75% and 13.37% weightage, respectively.

On a year-to-date basis, Nifty Pharma has delivered over 9% returns, which is under par when compared with the Nifty index, which has delivered over 23% returns. However, in a short period of one month, Nifty Pharma has outperformed the benchmark index as the former delivered returns of 3.5% while the latter remained at just 2%
 

Last week, Nifty Pharma, along with Nifty IT, played a crucial role in supporting Nifty to bounce back from its lower levels. Nifty Pharma registered a low of 13005 on 20 December and has shown a splendid performance since then. In just 8 trading sessions, Nifty Pharma surged nearly 9% and has outperformed Nifty, which surged 5.17%. Moreover, Nifty Pharma was trading below its 200-DMA a week ago, but the splendid rally witnessed the index rise higher above its 200-DMA.

On the technical charts, Nifty Pharma looks quite strong as it trades above all the short- and long-term moving averages. The index has been soaring for the past 4 days, and RSI has also entered the bullish territory. The index made a triple-bottom-like pattern and then made a sharp recovery. The Elder Impulse System and Pring’s KST show a bullish trend of the index. The +DMI indicator is well above the -DMI, which shows that bullish is likely to continue for some time.

The index is up over 0.5% today and is one of the top sectoral index performers. Nifty Pharma is looking quite bullish and technical parameters show no signs of halting. Thus, Nifty Pharma might be in focus for some more time.