IT Stocks Down: Why Are Infosys, Wipro And TCS Stocks Declining?

Information technology (IT) stocks on Tuesday declined heavily in the Nifty IT index due to a weak market.

While LTI Mindtree Limited (up 1.37%) and Tech Mahindra Limited (up 0.90%) were among the top gainers, several other stocks plunged bringing the index down.

The Nifty IT index declined more than 1% at the time of filing this story.

The Benchmark NSE Nifty50 index was down 20.25 points at 24704.24, while the BSE Sensex was down s873.38 points at 81556.52.

Of the 50 stocks in the Nifty index, 13 were trading in the green, while 37 were in the red.

Some of the most traded shares on the NSE were Vodafone Idea, YES Bank, Swiggy, Reliance Power and KFIN Technologies.

Why Are IT Stocks Declining?

Nifty IT was among the top gainers on Monday, as it surged by nearly 7%, which was the highest daily gain since April 2020, according to Sudeep Shah, Deputy VP and Head of Technical & Derivatives Research at SBI Securities.

But due to a weak market, Nifty IT declined on Tuesday.

Sugandha Sachdeva, the Founder of SS WealthStreet said, "Apart from this, IT stocks are down after witnessing a sharp upside of around 6.78% in the previous session, all because of the optimism surrounding the US-China
trade deal. So, that was the major reason why we saw a sharp rise in the IT index. But then today we are witnessing some cool-off. It's not a change in trend, but can be considered to be some minor profit booking."

"Nifty IT index witnessed a 8% rally in the last couple of trading sessions. It is now within touching distance of the 200 Day exponential moving average (38900) and hence is witnessing routine profit booking around resistance zone. There is no evidence of a trend reversal pattern indicating that the uptrend is still intact and today's weakness is only a routine profit booking. Crucial support levels for Nifty IT index is placed at 37300 - 37200. On the upside, we expect this rally to continue towards 40000 - 40200 from short term perspective," Jatin Gedia, Technical Research Analyst at Mirae Asset Sharekhan said.

Infosys: The stocks of Infosys had declined by 2.46% as compared to its previous close of Rs 1,586.90 apiece on the NSE.

Wipro: The shares of Wipro declined 1.68% compared to its previous close of Rs 252.97 per share on the NSE.

HCL Tech: The shares of HCL Tech also declined by 1.77%  compared to its previous close of Rs 1,640.80 apiece on the NSE.

OFSS: The shares of Oracle Financial Services Software (OFSS) were down 1.52% compared to its previous close Rs 8,592 per scrip on the NSE.

TCS: The shares of the IT services firm Tata Consultancy Services were 1.27% down compared to its previous close at Rs 3,574.60 apiece, on the NSE.

Also Read: Why Are BSE Sensex And Nifty 50 Falling Today After Monday’s Big Rally?