The Nifty Pharma index gained 1.4% on Monday, 8 June, bucking the market selloff, as investors sought refuge in defensive sectors amid heightened global uncertainty, according to experts. The Nifty Pharma index extended its winning streak for a fourth consecutive session on Monday, advancing 1.25%.
Pharma stocks traded mixed on Monday, with several mid- and large-cap names outperforming the broader market despite a sharp selloff in benchmark indices. The Nifty Pharma index remained in the green, supported by gains in select heavyweight stocks.
Among the top gainers, JB Chemicals & Pharmaceuticals surged nearly 1.8%, while Alkem Laboratories and Mankind Pharma advanced around 1.7% each. Torrent Pharmaceuticals, Ajanta Pharma, Dr Reddy’s Laboratories, and Gland Pharma also posted gains of up to 1.3%, reflecting continued investor interest in defensive healthcare plays.
On the flip side, Wockhardt emerged as the biggest loser, falling over 2.3%. Lupin, Cipla, Piramal Pharma, and Laurus Labs also traded lower, with declines of 0.3% to 0.8%. Divi’s Laboratories and Abbott India witnessed marginal losses.
The benchmark indices came under pressure, with the Sensex plunging 724.95 points to 73,518.39 and the Nifty 50 falling 222.45 points to 23,138.60 in early trade. The decline was driven by a sharp selloff in global equities, rising crude oil prices and escalating tensions in West Asia.
Market analysts suggest that pharmaceutical stocks generally perform better during times of market instability, as they are viewed as defensive investments. The demand for healthcare remains fairly consistent across economic conditions, making this sector less sensitive to cyclical recessions.
Analysts also pointed out that, unlike many sectors whose profits are closely linked to economic expansion, the pharmaceutical sector’s performance is frequently bolstered by factors such as medical advancements, product introductions, regulatory approvals, and healthcare demand, allowing it to maintain strength during periods of market pressure.
Technical Views
Sudeep Shah, Head of Technical and Derivatives Research, SBI Securities, noted that the Nifty Pharma Index has staged a strong recovery of nearly 15% from its April 2 low of 21,150 and continues to trade comfortably above its key short- and long-term moving averages, signalling a sustained uptrend. He highlighted that the Relative Strength Index (RSI) has rebounded from 49 to around 57, indicating renewed bullish momentum following the brief pullback from the May 20 high of 25,043.
According to Shah, major constituents such as JB Chemicals & Pharmaceuticals, Torrent Pharmaceuticals, and Zydus Lifesciences continue to exhibit robust price structures on both daily and weekly charts. He added that the 23,750–23,800 zone remains a critical support area, and the index is likely to retain its positive bias as long as it stays above this range.
Rajesh Bhosale, Equity Technical and Derivative Analyst at Angel One, said that after correcting from the 25,000 level, the Nifty Pharma Index has rebounded over the last four trading sessions and formed a higher-bottom pattern on the daily chart near its key 20-day exponential moving average (20-DEMA).
He believes the 24,000 mark remains an important support level and expects the index to resume its upward trajectory toward the 25,000 zone in the near term.
Disclaimer: This story is for educational purposes only. The views and recommendations above are those of individual analysts or broking companies, not Mint. We advise investors to check with certified experts before making any investment decisions.
