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Informist, Friday, Nov. 14, 2025

MUMBAI – Information technology stocks are expected to remain range bound in the upcoming week, according to analysts covering the sector. Sentiment around the sector remains cautious on the global sell-off in IT stocks amid concerns over high valuations against the backdrop of an artificial intelligence boom and hawkish comments from US Federal Reserve officials dampening hopes for a rate cut in the December meeting.

Growth visibility for the sector in FY26 remains hazy despite a slightly better September quarter earnings. "We expect the demand environment to remain challenging for the next one–two quarters due to the macro and tariff-led uncertainty," Nuvama Institutional Equities said in a report dated Tuesday. However, the brokerage remains positive on the sector's medium-to-long term outlook as technology debt continues to be very high for enterprises, which, in turn, demands a revival in spending as the macro environment improves.

With the rapid deterioration of the macro environment since the beginning of 2026, Nuvama expects a modest FY26 for the sector with a potential recovery in the second half. "We expect the growth for large-caps to be tepid in the near term due to macro headwinds, but recover over medium term with a revival in technology spends and the mammoth opportunity led by Gen AI," Nuvama said. Tier-2 IT companies, on the other hand, are expected to sustain their strong growth momentum going ahead, it added.  

The cumulative adjusted net profit of 12 companies, excluding Oracle Financial Services, which are part of the Nifty 200 index, grew a little over 5% sequentially in the September quarter, better than the 2.4% growth estimated by the Street. The aggregate revenue of these companies grew 4.5% sequentially, above the 3.6% growth expectation, as per estimates from 17 broking firms. 

Over this week, the Nifty IT index gained over 3% after falling on a weekly basis for two straight weeks. Friday, the sectoral index closed over 1% lower with most constituents ending the session in the red, as fading expectations of an interest rate cut by the US Federal Reserve triggered profit booking in IT stocks. Indian IT companies, which derive a major part of their revenue from the US, would benefit from an interest cut in the US, which is expected to increase discretionary spending by clients in the region. The chances of an interest rate cut at the Federal Reserve's December meeting have now been cut to 50% from about 70% a week ago, according to CME Group.

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

End

Reported by Arya S. Biju

Edited by Deepshikha Bhardwaj

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