The shares of IT companies are higher on June 10, pushing the Nifty IT index up over 1.5 percent to emerge as the top sectoral gainer in an otherwise cautious market, tracking positive cues from the trade negotiations between US and China, with both largecap and midcap IT names seeing significant investor interest.
The Nifty IT index has extended gains for a fifth consecutive session on rising optimism over ongoing US-China trade talks, hoping for trade tensions ease. Top officials from both the nations are set to meet in London for a second day to iron out differences and pull back from the trade war deadlock. US President Trump too has hinted that trade talks are going well, while admitting of challenges. "We're doing well with China. China's not easy," he told reporters at the White House, adding that he was 'only getting good reports' from his team in London. When asked if he will be lifting some export controls, Trump said, "We are going to see."
The possibility of easing trade tensions between US and China will likely relax concerns over economic strain on two countries after Trump's tariffs in April.
India's IT companies derive a major portion of their revenue from the US businesses.
Coforge shares were the top gainer on the index, jumping nearly 4 percent to trade at Rs 1,860 apiece. The sharp rise in the share price was fueled by a positive brokerage note. JP Morgan maintained an 'overweight' rating on the stock, with a target price of Rs 2,080 per share. This implies an upside potential of nearly 16 percent from the stock's previous closing price.
Persistent Systems shares followed, jumping over 3 percent. Mphasis and Tech Mahindra shares gained over 2 percent, while LTI Mindtree, HCL Tech and Tata Consultancy Services (TCS) shares were up over 1 percent each. Wipro and Infosys shares were meanwhile trading over 0.9 percent higher each.
(With inputs from Reuters)
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