Infosys, Wipro, HCL Technologies and Other IT Shares Rise for Fourth Day Amid ADR Surge

Market Performance

The Indian IT sector continued its upward momentum on December 2, marking the fourth straight session of gains. The Nifty IT index climbed 1.35 percent to 39,214.90 as of 10:10 am, accumulating more than 1,150 points—or over 3 percent—during this four-day rally.

Investors are keeping a close watch as major IT companies, including Infosys, Wipro, HCL Technologies, Coforge, Tech Mahindra, Tata Consultancy Services, and LTI Mindtree, showed strong movement in early trade.

Main News: ADR Surge and US Market Trends

The standout factor behind the rally was a sharp surge in Infosys American Depository Receipts (ADR), which reached fresh 52-week highs. The company clarified that no material event triggered this spike.

Traders noted that a short squeeze drove the sudden jump. A major lender recalled a large portion of stock lent to the market, forcing traders with short positions to cover quickly. This buying activity pushed the ADRs up aggressively in a thinly traded counter, although fundamentals remained unchanged.

Meanwhile, soft US inflation data added fuel to the rally. Consumer prices in the United States rose 2.7 percent year-on-year in November, slowing from a 3 percent increase through September. The moderation in inflation has reignited hopes for further Federal Reserve rate cuts, which could increase discretionary spending and support IT companies with significant exposure to the US market.

Key Drivers Behind IT Stocks Surge

Several intertwined factors contributed to the continued IT sector rally:

• Federal Reserve rate cut optimism: Positive commentary from Fed Governor Christopher Waller highlighted room for potential rate reductions amid job market weakness.
• Strong global IT results: Accenture reported robust first-quarter results, with revenue of $18.74 billion and new bookings rising 12 percent to $20.9 billion. AI-driven solutions were a major growth driver.
• Value buying in IT stocks: After months of corrections, investors are showing renewed interest in the sector due to better valuations.
• Depreciating rupee: The rupee pared early gains and traded at 89.70 against the US dollar. A weaker rupee benefits IT firms as most of their revenue comes from the US market.

Company Performance Highlights

• Infosys & Wipro: Both led the gains on the index, jumping more than 2 percent each.
• Persistent Systems: Shares gained nearly 2 percent.
• HCL Technologies, Coforge, Tech Mahindra: Each rose over 1 percent.
• Tata Consultancy Services (TCS): Shares advanced around 1 percent.
• LTI Mindtree: Saw marginal gains.
• Mphasis: The only notable laggard, down 1 percent, bucking the sector trend.

Summary

The Indian IT sector’s four-day rally highlights the continuing resilience of the industry, even amid global market fluctuations. Surges in ADRs, positive US economic signals, and value buying in the domestic market created an environment for stocks to climb steadily.

As Infosys, Wipro, HCL Technologies, Coforge, Tech Mahindra, TCS, and LTI Mindtree continue to respond to these market cues, the Nifty IT index remains in focus for traders tracking sector momentum.

With ADR movements, Fed rate expectations, and currency trends driving the narrative, December’s start has set a positive tone for IT stocks. Investors are watching closely, and market watchers are noting the convergence of international and domestic factors shaping the sector’s performance.

Source: Moneycontrol