Indian equity markets edged lower in Tuesday’s trade, January 19, for the second consecutive session. The indices were dragged lower by the IT stocks, along with realty counters. All the constituents of Nifty IT were in the red.
“The volatility in the market is likely to continue in the near-term till some clarity emerges regarding the US- Europe standoff on Greenland tariffs. Since both sides have hardened their positions, the uncertainty will continue for some time,” said VK Vijayakumar, Chief Investment Strategist at Geojit Investments.
A new development is likely today if the US Supreme Court ruling on Trump tariffs goes against President Trump. But there is no certainty on whether the ruling will happen today, added Vijayakumar. If it does, the ruling might change the scenario completely overnight.
3 reasons why IT stocks are falling today-
#1 Midcap IT stocks under pressure
The midcap IT stocks saw the maximum impact in today’s session, with LTIMindtree falling the most, plunging as much as 7.7% to an intra-day low of Rs 5,911.50 on the National Stock Exchange.
Tech Mahindra’s stock price has fallen over 2% to a low of Rs 1,678.20, which was followed by Wipro, which declined 2.7% to Rs 239.40. Other IT stocks like Infosys, HCLTechnologies, Mphasis, Coforge, and TCS also fell in Tuesday’s trade.
#2 LTIMindtree Q3: Analysts cautious on growth window
LTIMindtree’s Q3 FY26 revenue was marginally below Nomura’s estimates. The company’s revenue at $1,208 million was up 2.4% sequentially (5.2% YoY) in constant currency terms, against the brokerage’s expectations of 2.5% QoQ growth. In dollar terms, LTIMindtree’s all verticals delivered QoQ growth except for BFSI, which came in at -0.7%, and Technology, which was flat sequentially. Manufacturing came in at 9.4%, Consumer at 1.2%, and Lifesciences at 9.9%.
As per another brokerage house, Nuvama Institutional Equities, the top-5 clients of LTIMindtree reported a decline of 8.7% YoY/2.9% QoQ, led by weakness in top BFSI clients. Four of the Top-five clients have already stabilised, and the fifth, too, is anticipated to bottom out in Q4.
#3 FII outflows continue, rupee under pressure
The rupee fell 0.13% against the US dollar to 91.0250, with ongoing flow-based dollar demand tightening the squeeze as the currency broke past 91 per dollar levels for the first time in a month, putting it within striking distance of a fresh record low. The FII outflows continue adding to investor apprehension. FIIs are net sellers in equities so far in January.