IT Stocks Outlook
Seen down next week as concerns over US tariffs persist
This story was originally published at 20:42 IST on 8 August 2025
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MUMBAI – Information technology stocks are expected to continue their downward trend next week, as sentiment remains cautious amid heightened worries over US tariffs. However, analysts do not expect sharp declines in these stocks. "...it (decline in IT stocks) will largely be a gradual decline," a research analyst covering the sector at a domestic brokerage said. Post the announcement of 25?ditional tariffs on Indian exports to the US over its purchase of Russian crude oil, investors will now focus on US-Russia peace talks and India's response to the US tariffs.
US President Donald Trump issued an executive order Wednesday hitting India with an additional 25% tariff, effective Aug. 27, over its purchases of Russian oil. With this, the culminative additional tariff on Indian exports to the US will be 50%, among the highest rates imposed by the US. Adding to the broader negative sentiment, Trump on Thursday hinted that there will be no trade negotiations with India until "issues" regarding its purchase of oil from Russia are resolved.
"The IT sector is at an inflection point. Valuations are no longer expensive, but the health of the business—especially profitability—hinges on a revival in discretionary spending," Kotak Institutional Equities said in a report Monday. While some analysts remain optimistic on the revival of technology spending by clients with the easing of macroeconomic uncertainties over tariffs, Kotak believes that the path to recovery remains unclear, even with clients wanting to invest across multiple dimensions to become artificial intelligence-ready. "Execution will be key," the brokerage said.
Reports on the suspension of new orders from India by major US retailers, including Amazon and Walmart, following President Trump's imposition of 50% tariffs on Indian goods further added to the worries about discretionary spending, the research analyst said.
The Nifty IT index fell a little less than a percent over the week, with six out of the 10 constituents declining on a weekly basis. Coforge was the worst hit, falling nearly 6% over the week, followed by Infosys, L&T Technology Services, and Mphasis, which fell over 2.2-3.2%. The IT index has been in the red for five weeks in a row.
So far this year, the sectoral index fell nearly 21%, against a 3% rise in the benchmark Nifty 50 and 2% rise in the BSE Sensex. In July, foreign institutional investors turned net sellers after four consecutive months of being net buyers, with the IT sector witnessing the highest outflows.
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* IPO Alert: Transline Tech files draft papers with SEBI for 16.19-mln OFS
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* CE Info Systems Apr-Jun consol PAT falls 5.1% QoQ as sales fall 15.3%
* Birlasoft Apr-Jun consol PAT declines 12.8% QoQ as sales fall 2.4%
* Cyient group co inks reseller pact with GlobalFoundries
* Intellect Design partners Saudi Arabia bank to transform cash management
* LTIMindtree gets order of INR 7.92 bln from govt for PAN 2.0 project
* Trump announces 100% tariff on chips, semiconductors entering US
* Earnings Outlook: Birlasoft PAT seen flat on tariffs, poor show by verticals
* Infosys arm to pay Oregon attorney general office $225,000 for data breach
* Tech Mahindra gives Rolls-Royce 67.67-mln-euro guarantee for Italy-based arm
* Tech Mahindra, Dixon Tech sign pact to provide automation, software services
* N American oilfield svcs co Weatherford Intl extends pact with TCS by 5 yrs
* SC stays proceeding of Testbook suit in HC against Google's billing policy
* Govt awards LTIMindtree PAN 2.0 plan, expected to go live in 18 mos - source
* Mphasis, Flagstar Bank partner for tech modernisation, data center set up
* SPOTLIGHT: TCS layoff sparks fear but analysts say more bad news unlikely
* Honeywell Automation Apr-Jun PAT falls 8.7% YoY to INR 1.25 billion
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:
| Company | Price | Week-on-week change in % |
Resistance | Support |
| COFORGE LTD | 1606.80 | (-)5.80 | 1710.70 | 1549.30 |
| HCL TECHNOLOGIES LTD | 1475.70 | 1.60 | 1495.50 | 1449.10 |
| INFOSYS LTD | 1423.10 | (-)3.20 | 1440.60 | 1408.40 |
| L&T TECHNOLOGY SERVICES LTD | 4180.60 | (-)2.20 | 4267.90 | 4118.30 |
| LTIMINDTREE LTD | 5012.00 | (-)0.10 | 5082.00 | 4957.00 |
| MPHASIS LTD | 2695.90 | (-)2.20 | 2735.20 | 2633.40 |
| PERSISTENT SYSTEMS LTD | 5105.50 | 0.90 | 5236.20 | 5020.20 |
| TATA CONSULTANCY SERVICES LTD | 3036.40 | 1.10 | 3075.20 | 3005.60 |
| TECH MAHINDRA LTD | 1480.40 | 2.90 | 1505.60 | 1461.20 |
| WIPRO LTD | 239.05 | (-)1.50 | 245.10 | 235.40 |
| NIFTY IT | 34398.50 | (-)0.70 | 34757.30 | 34171.50 |
| NIFTY 50 | 24363.30 | (-)0.80 | 24676.80 | 24180.80 |
| BSE SENSEX | 79857.79 | (-)0.90 | 80835.90 | 79286.80 |
End
Reported by Arya S. Biju
Edited by Tanima Banerjee
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