BackNifty IT cracks over 2%; Tech Mahindra, Mphasis, LTIMindtree among top losers
Nifty IT index drops over 2% due to downward pressure on heavyweight companies.
PremiumIn Thursday's overall sluggish market, the Nifty IT index finished over 2% lower, driven by downward pressure on heavyweight companies including Tata Consultancy Services (TCS), Infosys, HCL Technologies, and Tech Mahindra Ltd.
TCS, Mphasis, and LTIMindtree shares all dropped between 2% to 4% on Thursday's trading session, and were top three laggards of Nifty IT index.
Shares of Tech Mahindra (down 4.24%), LTIMindtree (down 2.8%), Wipro (down 2.1%) were among the major laggards of the Nifty 50 index.
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According to technical analysts, given the prevailing bearish momentum, it is possible that we might witness additional weakness in the upcoming sessions.
Nevertheless, from a technical perspective, it's worth noting that this IT index previously broke out of a multi-month resistance level at 31,600, explained Rajesh Bhosale - Equity Technical and Derivative Analyst, Angel One.
"Therefore, any declines should be viewed as corrective rather than indicative of an actual price reversal. Traders should seize this as an opportunity, considering buying on further dips. Conversely, it's important to recognise that the immediate resistance lies in the range of 33,000 to 33,300," advised Bhosale.
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According to analysts for a few days now, the market has been under pressure, and the trend has persisted as a result of selling by foreign institutional investors. India VIX (up 10.7%) also increased significantly, indicating a high risk. Globally, attention will be focused on US GDP figures and the FED chief's speech, which will serve as a trend indicator.
Domestic benchmark equity indices, Nifty 50 and Sensex ended in red on the back drop of weak global cues, and sharp selling ahead of the F&O expiry.
The Nifty 50 closed at 19,523.55, down 192.90 points, or 0.98 per cent. The 30-share BSE Sensex closed lower at 517.54 points, or 0.78 per cent, at 65,601.15.
According to Prashanth Tapse, Research Analyst, Senior Vice President of Research at Mehta Equities, Nifty 50 sunk joining the conga-line of weak global stock markets. Nifty IT index drops 1.9%. The needle continues to print towards pessimism as Nifty’s bulls face a wall of worry.
Nifty 50 stayed depressed as extreme fear was being witnessed amidst FIIs selling, hawkish Fed backdrop, interest rates likely to be higher for longer to keep inflation in check, rising yields, spiking oil prices to $94 a barrel, and Washington's march toward its first shutdown since 2019.
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