Nifty IT index soars 4% in weak market as TCS' demand outlook, deal wins bring cheer

Nifty IT emerged as the sole sectoral index in the green today.

Information technology stocks glimmered in the green, bucking the sluggish market trend as industry leader Tata Consultancy Services' upbeat demand outlook lifted spirits for its industry peers as well.

While Wipro led gains within the pack with its 6 percent surge, others names like Infosys, HCLTech, Wipro, and Tech Mahindra rose 2-4 percent. The five large-cap IT majors sat on top of the list of gainers on the Nifty 50.

The surge in most IT stocks across the board also lifted the Nifty IT index nearly 4 percent higher, making it the sole sectoral index in the green today.

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Investors were hooked on to TCS' quarterly earnings, hoping to gauge changes in the demand scenario, since it was the first in the information technology pack to detail its numbers. And it can be said that the company did not disappoint. The management not only exhibited confidence over early signs of demand revival amid strong deal wins in Q3 but also guided for a stronger performance in CY25 and FY26.

The management's outlook, touted by Nuvama Institutional Equities as the most positive in two years, sparked strong buying across the IT pack on hopes of an improved demand environment for the industry going ahead. "Results of TCS indicate that the IT sector will continue to remain resilient," said V K Vijayakumar, Chief Investment Strategist, Geojit Financial Services.

Echoing a similar sentiment, Shaji Nair, Research Analyst, Capital Market Strategy, Mirae Asset Sharekhan, stated that TCS' commentary on early signs of revival in discretionary spend in some verticals is positive and is likely to set a good undertone for CY25.

The other four blue-chip IT majors—Infosys, HCL Tech, Wipro, and Tech Mahindra—are slated to release their quarterly numbers next week.