Indian IT stocks, including TCS, Infosys, HCL Tech, and others, gained momentum on Thursday, February 26, as global investors reacted to robust quarterly results from AI chipmaker Nvidia. The news triggered a wave of optimism across technology markets, lifting the Nifty IT index after months of subdued performance.
Market Performance: Nifty IT Climbs Amid AI Buzz
The Nifty IT index surged 2% to reach a day’s high of 31,112.20, marking its second consecutive session of gains. Over the last two sessions, the index has risen a total of 3.2%, offering a brief respite to investors after weeks of pressure.
Recent trends had seen IT stocks underperform:
- 1-month decline: 19%
- 3-month decline: 17%
- 1-year decline: over 20%
However, Thursday’s rally was broad-based, with nearly all IT stocks in the green:
- Persistent Systems: +3%
- Tech Mahindra: +2%
- L&T Tech, Infosys, Mphasis, LTI Mindtree, Coforge, HCL Tech, TCS: +1%+ each
- Wipro: +0.5%
This recovery reflects renewed investor confidence, largely influenced by Nvidia’s quarterly performance and its continued dominance in the AI chip market.
Nvidia Q4 Results: Driving Global AI Momentum
Nvidia reported a stellar quarterly performance, exceeding Wall Street expectations and highlighting ongoing strong demand for AI-focused chips. Key highlights include:
- Revenue: $68.1 billion (73% YoY increase)
- Wall Street estimate: $65.7 billion
- Net income: $42.96 billion (more than double YoY)
- Earnings per share: ~$1.76
The results underline the surging global investment in AI infrastructure, with Nvidia chips playing a central role in powering advanced AI models. Despite initial gains post-announcement, Nvidia stock ended 1.57% higher at $195.88, as some investors booked profits following its recent rally.
The quarter reaffirms Nvidia’s ability to convert robust AI demand into substantial profitability, maintaining its position as the preferred chip provider for high-performance AI computing worldwide.
Global Market Overview
Asian and US markets reflected the mixed sentiment around Nvidia’s outlook.
- Asian markets:
- MSCI Asia Pacific Index: +0.8%
- Hang Seng futures: +0.7%
- Japan’s Topix: +1.2%
- Australia’s S&P/ASX 200: +0.4%
- Euro Stoxx 50 futures: +0.7%
- US markets (overnight gains):
- S&P 500: +0.8%
- Nasdaq 100: +1.4% (tech-heavy index drove by mega-cap strength)
While the global AI surge boosts sentiment, some caution persists as investors weigh whether the AI boom could be reaching peak expectations.
Company-wise Focus: Indian IT Leaders
The Nvidia-inspired optimism lifted major Indian IT stocks across the board:
- TCS: Added over 1%
- Infosys: Up more than 1%
- HCL Tech: Crossed 1% gain
- Tech Mahindra & Persistent Systems: Strongest movers with +2% to +3%
- L&T Tech, Mphasis, LTI Mindtree, Coforge: Gained steadily
The broad-based recovery shows a positive correlation between global AI chip demand and the performance of Indian IT exporters.
Summary
Thursday’s session highlighted the interconnectedness of global AI developments and Indian IT stocks. Nvidia’s record-breaking Q4 results acted as a catalyst for a 2% surge in Nifty IT, with TCS, Infosys, HCL Tech, and others participating in the rally.
Investors and market watchers now see a short-term boost in the Indian IT space, supported by:
- Strong AI demand globally
- Recovery in major IT stocks after prolonged declines
- Positive investor sentiment driven by tech performance in the US and Asia
While questions about AI’s sustainability linger, the immediate effect on stock market today for IT stocks remains clear: optimism, broad-based gains, and renewed focus on Indian tech leaders
Source: Livemint
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