What is sectoral indices ?
Sectoral indices are like specialized teams within the broader stock market. They track the performance of a specific industry or sector, such as technology, healthcare, or energy. Think of them as mini-markets within the larger market, offering a focused view of how different parts of the economy are performing.
Here is the list of indices available on NSE:
1. Nifty Auto
Tracks the performance of leading automobile companies, reflecting trends in the auto industry influenced by consumer demand, innovation, and fuel prices.
Stocks under this sector:
Ashok Leyland, Bajaj Auto, Bharat Forge, Bosch, Eicher Motors, Escorts Kubota, Hero MotoCorp, Mahindra & Mahindra, Maruti Suzuki, Tata Motors, TVS Motor, Tube Investments.
2. Nifty Bank
Comprises major banking companies, serving as a barometer for credit growth, liquidity, and economic activity.
Stocks under this sector:
Axis Bank, Bandhan Bank, Federal Bank, HDFC Bank, ICICI Bank, IDFC First Bank, IndusInd Bank, Kotak Mahindra Bank, Punjab National Bank, State Bank of India, Bank of Baroda.
3. Nifty Financial Services
Covers financial services companies, including banks, NBFCs, and insurance providers, offering insights into the financial sector’s growth and health.
Stocks under this sector:
Bajaj Finance, Bajaj Finserv, HDFC, ICICI Lombard, ICICI Prudential, Kotak Mahindra Bank, LIC Housing Finance, M&M Financial Services, SBI Cards, Shriram Finance.
4. Nifty Financial Services 25/50
Tracks the same financial services stocks as Nifty Financial Services but ensures diversification by capping single stock weights to 25% and top three stocks to 50%.
Stocks under this sector:
Same as Nifty Financial Services.
5. Nifty Financial Services Ex Bank
Excludes banking stocks, focusing on NBFCs, insurance, and capital markets, offering a view of the non-banking financial sector.
Stocks under this sector:
Bajaj Finance, Bajaj Finserv, HDFC, ICICI Lombard, ICICI Prudential, LIC Housing Finance, M&M Financial Services, SBI Cards, Shriram Finance.
6. Nifty FMCG
Tracks companies producing essential items like food, beverages, and personal care products, reflecting consumer demand and spending trends.
Stocks under this sector:
Britannia Industries, Dabur India, Godrej Consumer Products, Hindustan Unilever, ITC, Nestle India, Tata Consumer Products, United Breweries, Marico, Emami.
7. Nifty Healthcare
Covers healthcare companies, including pharmaceutical manufacturers, hospitals, and diagnostic services, reflecting trends in healthcare spending and innovation.
Stocks under this sector:
Apollo Hospitals, Aurobindo Pharma, Cipla, Divi’s Laboratories, Dr. Reddy’s Laboratories, Lupin, Sun Pharma, Torrent Pharma, Zydus Lifesciences.
8. Nifty IT
Focuses on the IT sector, including companies in software and consulting, reflecting global outsourcing demand and technological advancements.
Stocks under this sector:
HCL Technologies, Infosys, TCS, Wipro, Tech Mahindra, LTIMindtree, Coforge.
9. Nifty Media
Comprises media and entertainment companies, reflecting trends in advertising, content consumption, and digital media.
Stocks under this sector:
PVR INOX, Sun TV, Zee Entertainment, TV18 Broadcast.
10. Nifty Metal
Tracks metal and mining companies, reflecting trends in commodity prices, demand, and infrastructure development.
Stocks under this sector:
Coal India, Hindalco Industries, JSW Steel, Tata Steel, Vedanta, Jindal Steel, NMDC, National Aluminium Company.
11. Nifty Pharma
Tracks pharmaceutical companies, focusing on drugs, healthcare products, and innovation in medicine.
Stocks under this sector:
Apollo Hospitals, Aurobindo Pharma, Cipla, Divi’s Laboratories, Dr. Reddy’s Laboratories, Lupin, Sun Pharma, Torrent Pharma, Zydus Lifesciences.
12. Nifty Private Bank
Tracks private sector banks, emphasizing their profitability and efficiency separately from public banks.
Stocks under this sector:
Axis Bank, HDFC Bank, ICICI Bank, IndusInd Bank, Kotak Mahindra Bank, Yes Bank.
13. Nifty PSU Bank
Tracks public sector banks, reflecting government-owned banking entities’ performance and reforms.
Stocks under this sector:
Punjab National Bank, State Bank of India, Union Bank of India, Canara Bank, Indian Bank.
14. Nifty Realty
Tracks real estate companies, reflecting trends in housing, commercial spaces, and infrastructure development.
Stocks under this sector:
DLF, Godrej Properties, Oberoi Realty, Prestige Estates, Sobha, Brigade Enterprises.
15. Nifty Consumer Durables
Tracks manufacturers of consumer durables like electronics and luxury goods, reflecting urban demand and discretionary spending.
Stocks under this sector:
Titan, Havells India, Voltas, Whirlpool of India.
16. Nifty Oil and Gas
Comprises companies in oil exploration, refining, and gas distribution, reflecting energy demand and regulatory policies.
Stocks under this sector:
ONGC, Reliance Industries, Indian Oil Corporation, Bharat Petroleum, GAIL India.
17. Nifty MidSmall Financial Services
Focuses on emerging NBFCs and financial services from the midcap and smallcap segments, highlighting growth opportunities.
Stocks under this sector:
A mix of mid and smallcap financial stocks
18. Nifty MidSmall Healthcare
Tracks midcap and smallcap healthcare firms, offering insights into emerging pharmaceutical players.
Stocks under this sector:
A mix of mid and smallcap healthcare stocks
19. Nifty MidSmall IT & Telecom
Includes smaller IT companies and telecom players, reflecting digital adoption trends and technological innovation.
Stocks under this sector:
A mix of mid and smallcap IT & telecom stocks
Why Studying sectoral indices is crucial for becoming a successful trader?
Studying sectoral indices is crucial for successful trading as they provide insights into the performance and trends of specific industries, helping traders identify high-potential sectors. By tracking these indices, traders can understand market sentiment, evaluate the impact of economic policies, and make informed decisions about sector rotation. Sectoral indices also aid in diversification, enabling traders to balance risks across industries. Additionally, they act as a benchmark to measure individual stock performance within a sector.
Sectoral indices provide a granular view of the stock market, allowing investors to:
- Identify industry trends: See which sectors are outperforming or underperforming.
- Make informed investment decisions: Allocate capital to promising sectors.
- Diversify effectively: Reduce risk by investing across different sectors.
- Spot potential opportunities: Identify sectors poised for growth.
- Gain a market edge: Understand the dynamics of specific industries.
By understanding sectoral indices, you can gain a deeper understanding of the market and make more strategic investment choices.
