The shares of TCS and Infosys were among the leading contributor on Sensex, as IT companies nudged higher on June 16 to push the Nifty IT index up over 1.3 percent as the top sectoral gainer, clocking gains in eight out of last nine sessions that have added over Rs 1.16 lakh crore in market capitalization.
The sharp rise in IT stocks has come at a time of simmering geopolitical tensions, with the war between Israel and Iran entering its fourth day with no signs of a resolution. On the charts, the index seems to be extending gains from April lows in a sign of reviving investor confidence.
The dollar index weakened to dropping to 98.09, while gold prices soared to record highs.
Analysts have, however, adviced caution on IT stocks given its sensitivity to the global business environment. “While we maintain our positive bias, the sector remains sensitive to global developments, and hence a buy-on-dips approach is preferred,” said Sameet Chavan, Head Research of Technical and Derivative at Angel One.
Sundar Kewat, Technical and Derivatives Analyst at Ashika Institutional Equity Globally said, “Market mood turned cautious as rising tensions in the Middle East rattled investors. The geopolitical situation escalated following Israeli military strikes on Iran, raising concerns about potential disruptions to oil supply and regional stability."
Coforge shares gained nearly 1.6 percent to trade at Rs 1,821 apiece, while those of Tata Consultancy Services (TCS) were up over 1.5 percent to hover around Rs 3,500 apiece. HCL Tech shares rose over 1.5 percent, while Persistent Systems and Mphasis shares gained over 1 percent.
Infosys and Tech Mahindra shares also gained over 1 percent to trade at Rs 1,620.50 apiece and Rs 1,677 apiece respectively. LTI Mindtree and Wipro shares were meanwhile trading in the green with marginal gains.
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