- The Nifty IT index fell 4 per cent to 30,034 on the National Stock Exchange (NSE) in Friday’s intra-day deals on profit-booking; by 09:47 AM it was the top sectoral loser, down 2 per cent versus a 0.13 per cent rise in the Nifty 50.
- The decline followed a rally: Nifty IT rose 19 per cent in July, with Tata Consultancy Services (TCS), HCL Technologies, Tech Mahindra, LTM and Persistent Systems up 19 per cent to 27 per cent.
- Global tech sentiment was buoyed by Microsoft: Wall Street rebounded, NASDAQ gained 2.8 per cent, and stronger-than-expected guidance reignited optimism toward technology stocks.
The Nifty IT index experienced a significant drop of 4% to 30,034 on the National Stock Exchange (NSE) as investors engaged in profit-booking following a remarkable 19% rally in July. This downturn was particularly evident in stocks like Persistent and Mphasis, which plunged 5% each.1234
The decline in the Nifty IT index comes after a period of strong performance, where stocks such as TCS, HCL Technologies, and Tech Mahindra surged between 19% to 27% in July. The recent profit-taking reflects a broader trend of volatility in technology stocks, influenced by global market movements. Rajesh Palviya, Head of Research at Axis Direct, noted that Wall Street's rebound, driven by robust earnings from Microsoft, has fueled optimism around AI-led technology spending, lifting the NASDAQ by 2.8%.56
Despite the current selling pressure, analysts suggest that the recovery in global technology stocks may provide near-term support for Indian equities. Ponmudi R, CEO of Enrich Money, emphasized the need for investors to remain vigilant regarding geopolitical developments and their potential impact on energy prices and market sentiment. The IT sector is also undergoing a structural shift towards nonlinear, outcome-oriented delivery models, focusing on platforms and AI-enabled services rather than traditional headcount expansion.
As the industry adapts to these changes, the integration of AI into various domains is reshaping enterprise needs, with clients increasingly seeking partners capable of delivering comprehensive solutions across the AI lifecycle, according to HCL Technologies.
“Nifty IT was down 2% at 09:47 AM, the top sectoral loser versus a 0.13% rise in Nifty 50, with the index at 30,034. Microsoft's stronger-than-expected guidance lifted the NASDAQ 2.8%, even as Geojit's Dr. VK Vijayakumar flagged excessive volatility in South Korea, where Samsung and SK Hynix account for 52% of Kospi's capitalization.”
