Infosys (NS:INFY) experienced a remarkable surge of 7% on Friday, contributing to a substantial 600-point gain in the Sensex. The positive momentum in Infosys shares was mirrored across the major IT companies.
Tech Mahindra (NS:TEML) witnessed a gain of over 4%, Wipro (NS:WIPR) also saw an increase of more than 4%, and TCS (NS:TCS) recorded a rise of over 3%. The BSE Sensex reflected this upward trend, trading up 631 points at 72,352.
V.K. Vijayakumar, Chief Investment Strategist at Geojit Financial Services, anticipates increased activity in IT stocks following Infosys' inline results and TCS's better-than-expected performance. Despite the lack of positive signals in the management commentary, the market is expected to respond positively to the absence of unfavorable news. However, Vijayakumar notes that the upside for TCS and Infosys may be constrained as the sector awaits clarity on prospects for FY25.
The resilience observed in IT stocks, coupled with the strength in Reliance (NS:RELI), is poised to support Nifty consolidation around 21,600 levels. Market watchers are keenly awaiting HDFC Bank's (NS:HDBK) results on January 16, as they are expected to provide cues for the direction of Bank Nifty.
Vijayakumar also highlights that the slight uptick in US CPI inflation to 3.4% YoY has a mildly negative impact from the global equity market perspective. The anticipated rate cut from the Fed in March might be postponed to June, delaying the MPC's rate cut as well.
(With Agency Inputs)
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