Nifty IT in focus: The Nifty IT index surged 2.09 per cent on Friday, August 8, 2024, reaching an intraday high of 39,252.40, driven by strong performances from major IT stocks.
Mphasis led with a 4.06 per cent increase, followed by LTTS (3.39 per cent),Tech Mahindra (2.91 per cent), Persistent (2.82 per cent), HCLTech (2.76 per cent), LTIMindtree (2.71 per cent), Coforge (2.55 per cent), Infosys (2.15 per cent), TCS (1.94 per cent), Wipro (1.87 per cent),
The rally in IT stocks came on the heels of a major drop in US jobless claims, which fell to 233,000 for the week ending August 3—the largest decline in nearly a year.
The positive economic data boosted US markets, with the S&P 500 climbing 2.30 per cent, the Dow Jones rising 1.76 per cent, and the Nasdaq advancing 2.87 per cent.
The rebound in US markets suggests that recession fears may have been exaggerated. The lower-than-expected jobless claims indicate that the labour market remains resilient, although concerns about a slowing US economy and challenges in China could impact global growth, said V K Vijayakumar, chief investment strategist at Geojit Financial Services.
At the beginning of the week, IT stocks fell sharply as fear of a recession in the US due to rising unemployment added to the concerns of India’s IT services sector, which was seeing some growth returning post-Q1FY25 results.
The Nifty IT closed 3.26 per cent down on Monday, August 5, as major IT services companies’ stock value fell. Tata Consultancy Services (TCS), India’s largest IT services firm, saw its stock price fall 4 per cent during intraday trading. READ MORE
“The IT sector was initially down at the start of week as US markets, especially tech stocks plunged on back of worries on the economy front as disappointing US payrolls data, concerns about the Federal Reserve’s rate-cutting timeline and the unwinding of the Japanese yen carry trade. However, the index recovered sharply post correction as fears allayed post latest weekly jobless claims number helping alleviate investors’ concerns about the strength of the labour market and state of the US economy,” said Narendra Solanki, head fundamental research of investment services at Anand Rathi Shares and Stock Brokers.
Hiring may pick up
Apart from that, according to data from hiring platform Indeed, hiring in the IT sector is set to see a growth of 8.5 per cent in the year 2025, owing to demand for skilled IT talent in the country.
At 10:39 AM, Nifty IT index was trading 1.40 per cent higher at 38,988.45 levels. In comparison, Nifty50 was trading 0.88 per cent higher at 24,329.90 levels.
First Published: Aug 09 2024 | 11:06 AM IST
