Market Movers: Covid curbs dampen bull case for hospitality sector

A year ago the general notion was that if the vaccination rate goes up, there will not be a need to curb travel and tourism. However, Omicron, which seems to not care if you are jabbed or not, has thrown a spanner in that plan.

India is steadily reporting a rise in cases of the new variant and it is likely that the strain will become the most dominant in the coming months leading to a surge in cases. With cases rising and vaccines not providing protection against infection even if they don’t lead to severe symptoms, travelers are likely to delay their plan till the new wave subsides.

Investors are worried that risk aversion among consumers is likely to further dampen the March and June quarter earnings of hotel companies just when they were showing signs of revival. Shares of hotel and entertainment sector stocks fell 2-3 per cent on these concerns.


Chemicals stocks still have a lot to offer

Over the past two months, many supporters of chemical stocks in the market have turned risk-averse.

Sign of a slowdown in demand and pressure on margins has made shares of chemical companies unattractive for investors especially given the rich valuations they were quoting earlier. Some money managers have gone on to suggest that the sector’s heydays may be over.

However, over the past few sessions, chemical stocks are making a case for themselves. Several stocks have surged rapidly, aided likely by bargain hunting from investors who are always on the lookout for cheap bets.

Some analysts believe that investors’ attention in the sector will move towards specialty chemical companies where the cause for concern on margins is lesser while they are also investing in new capacity. This optimism reflected in shares of India Glycols, Rain Industries, Clariant Chemicals, Aarti Surfactants, and Neogen Chemicals rose 2-20 per cent.


Bajaj Auto supercharges EV bet

As several non-listed automobile makers are ramping up their investments towards electric vehicles, Bajaj Auto appears to not want to be left behind.

The company that suggested that legacy players like itself have new-age automakers like Ather and Ola for breakfast, required fresh investments in its electric vehicle segments to back the swagger it has displayed with action.

The two-wheeler maker said earlier today it will pump in Rs 300 crore on a new unit in Akurdi that will have the capacity to churn out 500,000 EV units per year. Bajaj Auto’s investment is also a reflection that automobile makers see the EV future coming much earlier than was expected before. Investors liked the company’s ambition as they pumped up the stock by 3 per cent.