Indian IT stocks rallied for a second consecutive week, with the Nifty 50 closing near 23,146 and the Sensex at 74,729, up 2.78% and 3.11% respectively, driven by renewed investor interest in the sector. This surge followed a global rotation away from AI hardware and semiconductor stocks, redirecting capital flows toward Indian IT service providers, according to livemint.com.
The rally was triggered by growing investor scepticism over high valuations and delayed monetisation in international AI and semiconductor companies. As global funds pulled back from these overextended sectors, Indian IT firms, known for stable execution and attractive valuations, became a preferred defensive option. Vaishali Parekh, Vice President of Technical Research at Prabhudas Lilladher, noted the improved market bias and highlighted the importance of the Nifty 50 index breaching the 23,300 level to confirm positive momentum, per livemint.com.
This shift underscores a broader market trend where investors seek stability amid volatility in high-growth tech segments. Indian IT companies like Coforge attracted significant buying interest, benefiting from the global reallocation of funds. The move contrasts with the sell-off in international AI and semiconductor stocks, reflecting concerns about stretched valuations and uncertain monetisation timelines in those sectors, as detailed by livemint.com.
Vaishali Parekh recommended stocks including Coforge, Lalithaa Jewellery, and Titan, emphasizing the need for the Nifty 50 to decisively breach the 23,300 zone to sustain gains. The market’s next critical test will be whether this level holds in upcoming sessions, according to livemint.com.