Mumbai: Reversing the downtrend, shares of IT companies on Friday turned gainers in morning trade on the Bombay Stock Exchange led by bellwether Infosys, which beat street expectations after reporting a 7.5% rise in quarterly profit.
Analysts believe the-better-than-expected Q2 earnings of Infosys stimulated buying in the counter by investors, which was witnessing heavy profit booking in the past four trading sessions.
Shares of the country’s second largest software exporter, Infosys Technologies, jumped nearly 4% to Rs2,293.65 after the outsourcer reported a 7.5% rise in quarterly profit at Rs1,540 crore, beating street estimates.
Buoyed by the performance of the sector bellwether, shares of the largest software exporter Tata Consultancy Services jumped 3.13% to a high of Rs591 on the BSE.
“Rising rupee would act as a dampener for the IT stocks going forward as the markets are at resistance level. Today’s gain in the IT stocks are all short term as the momentum is driven by Infosys forecast,” SMC Global vice president Rajesh Jain said.
A strong rupee adversely impacts the profits of IT companies (as they get less rupees against every dollar earned), which in turn affects their margins.
Besides, Wipro rose by 2.81% to Rs581 and HCL Technologies was up 2.72% at Rs307.