Top-performing sectoral index: Nifty FMCG

The FMCG index is trading flat despite the overall weakness in the market.

On the technical chart, Nifty FMCG has formed a bullish candle. The global and local sentiment has hurt market sentiment which is very well reflected in the other sectoral index as all are trading in deep red. However, investors have preferred defensive stocks like FMCG, and thus, strong buying has been seen across most of the FMCG stocks.

ITC and Britannia have emerged as the top gainers among the Nifty stocks. Colgate Palmolive (+1.02%) has also seen good interest.

Nifty FMCG has been trending strongly for quite some time. Since its prior swing low, the index has surged nearly 10% before correcting slightly. On the technical chart, it has formed a double top and despite opening lower, the index has found strong support at its neckline level of 37000.

It trades above 50-DMA and 100-DMA and is marginally lower than its 20-DMA and 200-DMA. The RSI (48.61) is placed in the sideways zone. The +DMI is placed above the -DMI and shows good strength. On the weekly chart, the MACD line is above the signal line and zero line, demonstrating medium term bullishness.

Comparing the index’s performance against Nifty 50, it has delivered flat returns as against the latter’s negative -6% returns. Moreover, the index has also performed better than most of the other sectoral indices in the recent period. Traders and investors can consider the FMCG stocks for their trading and investment activities, as these stocks have shown strong strength during these turbulent times. The FMCG companies have maintained a strong profit margin despite rising raw material prices, and thus have been a critical factor in the index’s strong strength.

Nifty FMCG is a sectoral index, designed to reflect the behaviour of FMCG companies in India. The rescheduling of index constituents happens bi-annually every year. The index comprised of 15 stocks have outperformed the other sectoral indices today.