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Stocks of major fast moving consumer goods companies are seen trading in a narrow range with a negative bias next week due to likely profit booking and also as investors shift focus to other sectors.
At current levels, value of FMCG companies' shares remains high, which leaves room for correction. Also, there is a renewed interest in shares of companies in sectors such as information technology, infrastructure, and oil and gas and this may lead to investors changing the composition their portfolio giving less weight to FMCG companies, a so called defensive sector.
The market will keep an eye on the Oct-Dec earning announcements of companies such as Colgate Palmolive India and Marico. Colgate Palmolive India and Marico will report their earnings on Jan 30, and Feb 1, respectively.
Sector heavyweight ITC, which carries most weight on the BSE-FMCG index, pulled the performance of the index above that of the broader indices this week. Over the past two weeks, shares of the company have gained 9.4% on better-than-expected Oct-Dec earnings.
In contrast, shares of Hindustan Unilever, another sector heavyweight, have lost 4.3% over the past two weeks as the company failed to meet street view on its earnings for Oct- Dec.
