On Monday, equity benchmark indices in India tumbled in early trade, breaking a nine-day rally, as index major Infosys fell nearly 12 per cent after lower-than-expected revenue growth guidance for FY24. Weak trends in other IT counters also pulled the benchmark lower. The 30-share BSE Sensex tanked 677.86 points to 59,753.14 in early trade, while the broader NSE Nifty fell 200 points to 17,628.
Among the Sensex firms, Infosys emerged as the biggest laggard, falling nearly 12 per cent after the company reported lower-than-expected growth in the fourth quarter net profit and gave a weak 4-7 per cent revenue growth guidance for FY24 amid the tightening of IT budgets by clients following a turmoil in the US banking sector. Tech Mahindra, HCL Technologies, Tata Consultancy Services, Wipro, HDFC, and HDFC Bank were the other laggards.
“The worse-than-expected Q4 results from Infosys with only 4-7 per cent revenue growth for FY24 will drag down IT stocks impacting the Nifty,” said V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.
In Asian markets, Seoul and Japan were trading lower, while Shanghai and Hong Kong quoted in the green. The US markets had ended lower on Friday. “Denting sentiments are TCS and Infosys’ Q4 results which missed street estimates. Investors would also focus on March inflation based on the Wholesale Price Index (WPI),” Prashanth Tapse, Senior VP (Research), Mehta Equities Ltd, said.
Equity markets were closed on Friday on account of Ambedkar Jayanti. The Sensex had gone up marginally by 38.23 points or 0.06 per cent to settle at 60,431 on Thursday. The Nifty climbed 15.60 points or 0.09 per cent to finish at 17,828. Foreign Portfolio Investors (FPIs) bought equities worth Rs 221.85 crore on Thursday, according to exchange data.
The global oil benchmark Brent crude climbed 0.07 per cent to USD 86.37 per barrel. With markets being closed on Friday, investors were eagerly watching the opening on Monday to assess the direction for the week. The decline in the Sensex and Nifty was mainly attributed to the poor performance of Infosys, which resulted in a domino effect across the IT sector. The overall sentiment was negative, with some positive performances by select companies such as Power Grid, IndusInd Bank, UltraTech Cement, Nestle, Titan, and Hindustan Unilever.