IT Stocks Today: Technology stocks were upbeat in trade on June 10, buoyed by hopes of a US-China trade breakthrough and fresh optimism around India's free trade pact with the European Free Trade Association (EFTA) bloc, which is expected to increase demand for India's IT services. The Nifty IT index, which captures the performance of India's IT companies, surged as high as 2.38 per cent in intraday trading before paring some gains to close 1.67 per cent higher.
This is the fifth consecutive session of gains for the Nifty IT index, during which it has surged over 4 per cent.
Oracle Financial Services Software, which climbed 3.91 per cent, led the gains on the index in today's trade. This was followed by 2.75 per cent gains in Persistent Systems, 2.65 per cent gains in Mphasis, and 2.51 per cent gains in LTIMindtree.
Coforge, Tech Mahindra, HCL Technologies, Wipro, Infosys, and Tata Consultancy Services (TCS) also advanced between 1.17 per cent and 2.17 per cent. There were no losers in the index.
Ajit Mishra, SVP, Research, Religare Broking, told Outlook Money: "The Nifty IT index has been witnessing a gradual recovery for the past five sessions, including today, largely driven by anticipation of a possible trade deal between the US and China, which could bring global stability and ease concerns over trade wars."
Rupak De, Senior Technical Analyst, LKP Securities, too, echoed the same reason behind the raly in IT stocks today. He said, "On the back of renewed optimism coming from positive developments in the US-China trade talks, the sentiment around the IT space has improved."
Sumit Pokharna, VP - Fundamental Research, Kotak Securities, attributed the rally to India's free trade agreement with the four-nation EFTA bloc.
The EFTA comprises of Iceland, Switzerland, Norway, and Liechtenstein. The free trade agreement is expected to come into effect in September, Commerce and Industry Minister Piyush Goyal said on June 9. The Trade and Economic Partnership Agreement (TEPA), signed on March 10, 2024, has now received approval from the parliaments of all four EFTA member countries.
Under the pact, EFTA will invest $100 billion (Rs 85.62 lakh crore) in India over the next 15 years. In return, India will reduce or eliminate duties on various products from the bloc, including popular items like Swiss watches, chocolates, and cut and polished diamonds.
Pokharna believes the pact will result in higher demand for Indian IT services.
