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Informist, Friday, Aug 23, 2024

MUMBAI – Shares of information technology firms will likely extend gains next week after the US Federal Reserve Chair Jerome Powell today indicated that the Fed would cut interest rates in September, even though no clarity was provided on the quantum of rate cuts. 

Powell, at the Jackson Hole Economic Symposium in Wyoming, said today that it was time for adjusting the monetary policy, but stopped short of giving a clear indication on how large that move would be. He said the Fed was prepared to adjust policy to protect the labour market from weakening further and to ensure that the economy was on course for a soft landing.

After Powell's speech, the probability of a 50-basis point rate cut at the Fed's meeting in September increased to 32.5% from 28% earlier today, as per the CME FedWatch Tool. Meanwhile, the probability of a 25-bps rate cut fell to 67.5% from 72% before the speech.

The Fed cutting interest rates is seen as a major positive for the information technology sector as that could result in an increase in discretionary spending by clients in the US, a significant market for Indian IT companies.

The June quarter started on a positive note for the IT sector, leading most companies, excluding Infosys, to maintain their guidance or positive outlook for 2024-25 (Apr-Mar), Prabhudas Lilladher said in a report. Given the growth uptick in Apr-Jun, along with some green shoots of demand recovery beyond the critical line of business, if not discretionary, the brokerage expects the constructive recovery to continue in the coming quarters.

Nifty IT index ended 1% lower at 41089.85 points today. This week, shares of L&T Technology Services and Mphasis were the top gainers in this index, while those of Wipro and Coforge were the worst hit.

TOP HEADLINES

* Wipro voluntarily liquidates US arm Rizing Management
* Cyient completes 14.5% stake sale in Cyient DLM via block deal
* IPO Alert: Orient Tech IPO subscribed 17 times as of second day
* SC refuses to stay meet of BYJU'S parent co's committee of creditors
* RBI updates e-mandate framework, adds auto-replenishment for FASTag
* Wipro to modernise John Lewis Partnership's IT infrastructure
* PRESS: Minister Goyal red-flags e-commerce predatory pricing, job loss
* IPO Alert: Orient Technologies IPO subscribed 6.65 times as of day 1
* L&T Technology ties up with Thales for software monetisation
* IPO Alert: Orient Tech raises 644.3 mln rupees from anchor investors
* Cyient to sell 14.5% stake in arm Cyient DLM Wed via block deal
* L&T Finance partners with CRED to offer unsecured personal loans
* Tech Mahindra to sell land, building space to Mahindra University
* Coforge in pact with Salesforce to launch environment, net zero pdt
* HCL Technologies appoints Shiv Walia as CFO effective Sep 7
* Forensic report shows laptops not compromised in cyberattack - WazirX
* Mphasis appoints Aravind Viswanathan as CFO with immediate effect
* IPO Alert: Ecom Express files draft papers with SEBI for public issue
* RBI revises guidelines for NBFC peer-to-peer lending platform

Following are the resistance and support levels for the stocks for next week as per calculations by Informist based on their prices on the National Stock Exchange:

End

Reported by Alina Geogy

Edited by Deepshikha Bhardwaj

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