Nifty IT index is down by over 2%: Here's why
Nifty50 and Sensex experienced a minor drop today, driven by concerns over US inflation. IT sector stocks emerge as the top loser. At the time of writing, Nifty50 was trading 0.54% down at 20,792.90, and Sensex was lower 0.54% at 69,178.31. "Tonight's Fed message is important for global markets, which will wait for Chair Jerome Powell's commentary before taking a decisive turn," said VK Vijayakumar, chief investment strategist at Geojit Financial Services.
IT sector heavily impacted by US inflation data
The IT sector, which holds a 13.64% weightage in the Nifty50, saw a 2.10% decrease with all 10 constituents experiencing losses. Tata Consultancy Services (TCS) and Infosys were among the top Nifty50 losers, with their shares dropping 2.45% and 2.6%, respectively. This decline comes after data revealed an unexpected increase in the US Consumer Price Index (CPI) for November, raising doubts about a potential Fed rate cut in the first half of 2024.
Other factors affecting Indian equities
However, per analysts cited by Reuters, Indian equities might get ongoing support from lower domestic retail inflation, increased factory output, and falling global crude oil prices. Energy stocks saw a 0.2% decline as Brent crude futures hit a six-month low following US inflation data that exacerbated demand concerns amid ongoing oversupply issues. Nifty Service Sector traded 0.85% lower and Nifty Oil & Gas was down 0.67%. Among indices, Nifty PSE remained the top gainer, up 1.55%.
