TCS, Infosys, Tech Mahindra: Why IT stocks are in focus this week? Key levels to watch

“The market sentiment towards IT stocks is mixed, with both bullish and bearish views, and I believe those with a less pessimistic view expect a faster revival in the sector. If the economic outlook remains uncertain or worsens, it’s likely that the growth of Indian IT companies will slow down. However, we do expect tech spending to revive slowly and mid to high single-digit growth for the top five Indian IT companies in FY24,” said Rohan Mehta, CEO and portfolio manager, Turtle Wealth.

The US retail sales print this week was bullish for the IT sector but the slowdown in factory activity still remains, as per experts.

“Markets are reacting to selective economic data and the fact that most of the interest rate hikes have been priced into the markets. Fundamentally, the major players continue to close on major deals, build their pipeline and the attrition rate is trending downwards. Challenges like growth slowdown in their major markets are now visible and management is hinting at this. Even though we do not foresee a major outperformance in the IT space until later this year, most of the correction has taken place,” said Sreeram Ramdas – Vice President at Green Portfolio.

Key levels to watch

“The IT stocks are taking cues from the recovery in US market and robust Q3 financial performance. On technical setup also, Tech M, TCS and Infosys are showing strength on daily and weekly chart pattern. The momentum indicators like MAs, RSI and MACD are lying in the Buy zone suggesting a strong move ahead. In near term, Tech M may touch 1350 levels, TCS around 3600 levels and Infosys may hit 1800 levels,” said Ravi Singh, Vice President and Head of Research, Share India.

The views and recommendations made above are those of individual analysts or broking companies, and not of Mint.