Nifty IT index soars nearly 3%; Tech Mahindra, HCL Tech, Infy gain up to 4%

The technology-heavy Nasdaq Composite surged 3.3 per cent on Friday, as investors reassessed the expected path of Federal Reserve interest-rate hikes.

TCS, Wipro, Infosys, IT Companies
IT stocks in demand on Monday
SI Reporter Mumbai
2 min read Last Updated : Jun 27 2022 | 10:08 AM IST
Shares of information technology (IT) companies were in focus on Monday with the Nifty IT index gaining nearly 3 per cent on the National Stock Exchange (NSE) in intra-day trade. The buying at these counters is attributed to sharp over 3 per cent surge on the technology-heavy Nasdaq Composite index on Friday, as investors reassessed the expected path of Federal Reserve interest-rate hikes.

At 09:41 AM, the Nifty IT index, was the top gainer among sectoral indices, as compared to 1.3 per cent gain in the Nifty 50 index. The IT index had hit a 52-week low of 26,399.75 on June 17, 2022. In the past three months, Nifty IT index tanked 24 per cent, as compared to 7 per cent decline in the Nifty50 index till Friday.

Tech Mahindra, HCL Technologies, Mphasis, Coforge, Larsen & Toubro Infotech, Mindtree, L&T Technology Services, Infosys, Wipro and Tata Consultancy Services (TCS) were up in the range of 2 per cent to 4 per cent on the NSE.

Also read: Strong order book, high attrition: What Accenture's Q3 means for Indian IT

Investors expect the Fed funds rate to peak between 3.25 per cent and 3.50 per cent in December, down from 3.50 per cent to 3.75 per cent one week ago, according to the CME’s FedWatch tool.

“US market now seems to be interpreting recent signs of slowing growth as a reason for the Federal Reserve to potentially have “a lighter touch” in its battle with inflation. A recent slide in commodity prices eased worries about inflation and the rate hike outlook,” said Deepak Jasani, Head of Retail Research, HDFC securities.

Meanwhile, Accenture’s commentary suggests that the demand environment remains supportive, and the weakening macro environment has not yet started impacting growth in the sector. While supply-side challenges remain a point of concern, with elevated attrition and lower headcount addition, Accenture’s margin guidance implies a stable margin performance in FY23, Motilal Oswal Financial Services said in IT sector update.

“We maintain our positive stance on the sector as we expect sustained growth with stable margin. Infosys, HCL Technologies, and TCS remain our preferred picks within the Tier I IT space,” the brokerage firm said.


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Topics :Buzzing stocksIT stocksMarket trendsInfosys WiproHCL TechnologiesL&T InfotechMindTreeTech MahindraCoforge

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