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Informist, Friday, Aug 9, 2024

MUMBAI - Shares of information technology companies will continue to take cues from global markets next week. Analysts were divided on the possible trend in the IT space. While few analysts expect an upmove, others have projected volatility. 

 

This week, the Nifty IT index closed 1.7% lower at 39043 points, with nine out of 10 constituents of the index ending lower. While L&T Technology Services and Coforge were among the top losers, Persistent Systems was the only constituent that gained. In comparison, the Nifty 50 and Sensex declined 1.4% and 1.6%, respectively.

 

"IT stocks have seen a good run-up post Apr-Jun earnings announcements. However, this week there was profit booking in this space and stocks mirrored trends seen in global markets," said Ruchit Jain, a lead analyst at 5paisa. "From a near-term perspective, we are cautious on the sector till we see some strength in global markets."   

 

The US is a key market for Indian IT companies. This week, global markets were weak on concern about a slowdown in the US, and the unwinding of yen carry trades.

 

"Profit bookings observed in the Nifty IT sector during the first week of August persisted this week, primarily due to global turmoil. However, some encouraging signs emerged in certain stocks within this sector during the second half of the week," said Rajesh Bhosale, a technical analyst at Angel One. "If global conditions remain stable, we could see this sector move higher, potentially reaching new highs around 41,000." Next week, the immediate support for Nifty IT index is seen at 38700 and resistance at 39300.

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Following are the resistance and support levels for the sector's key stocks for next week, as per calculations based on their prices on the National Stock Exchange:
 

Company	Price	Week-on-week  change in %	Resistance	Support
HCL Technologies	1589.95	(-)1.20	1615.40	1563.10
Infosys	1770.75	(-)2.80	1793.90	1744.40
L&T Technology Services	4896.90	(-)4.00	5124.20	4774.10
LTIMindtree	5373.55	(-)2.50	5524.70	5290.10
Persistent Systems	4699.05	1.40	4798.90	4585.10
Tata Consultancy Services	4228.75	(-)1.30	4277.40	4181.20
Tech Mahindra	1506.70	(-)0.10	1527.50	1470.10
Wipro	491.30	(-)2.20	499.30	485.70
Nifty IT	39043.30	(-)1.70	39396.40	38755.30
Nifty 50	24367.50	(-)1.40	24474.70	24257.60
S&P BSE Sensex	79705.91	(-)1.60	80181.60	79311.30

 

End

Reported by Darshan Nakhwa
Edited by Akul Nishant Akhoury

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