The Sensex has recovered almost 6 per cent from the lows that it hit in the month of Feb and March 2018. However, the broader markets have noway recovered and the Sensex rise is largely on the back of two stocks - Reliance Industries and TCS.
Shares of TCS have jumped 25 per cent, from levels of Rs 2,800 in March to the current levels of Rs 3,500. Now TCS has the highest weightage in the Sensex.
Ditto with Reliance Industries, which has pulled the index higher and has the second highest weight in the Sensex. Several other Sensex stocks are languishing near 52-week lows, including prominent names like Tata Motors and SBI. In fact, banking stocks, which have the highest sectoral weight in the Sensex have hardly moved including the likes of ICICI Bank, HDFC Bank and Axis Bank.
Auto stocks are still languishing and so is another heavyweight - ITC. As long as Reliance Industries and TCS rally, the indices would rally. Both these stocks have gone-up a great deal already, especially TCS. It has rallied following a spectacular set of quarterly numbers for the period ending March 31, 2018.
It is time that other stocks too participate for a more broadbased rally.