TCS, Tech Mahindra, HCLTech, Infosys Jump On Nvidia Outlook

Mumbai, August 28: Indian information technology stocks rallied sharply in morning trade on Friday, with the Nifty IT index jumping over 3%, as a strong overnight rally in U.S. technology shares revived investor appetite for the sector. 

The gains followed a bullish outlook from Nvidia, which helped ease concerns over the sustainability of artificial intelligence spending and provided a fresh boost to the global technology trade. The tech-heavy Nasdaq had surged 1.6% while Nvidia shares jumped 8.7%. TCS rose 3.6%, Tech Mahindra advanced 3.3%, HCLTech rose 3.5%, and Infosys climbed 2.7%. 

TCS, Tech Mahindra, HCLTech Lead Rally 

All 10 constituents of the Nifty IT index traded higher, with TCS, Tech Mahindra, HCLTech and Infosys among the key gainers. 

The broad-based advance came as investors looked to Indian IT companies to benefit from the continued expansion of global spending on artificial intelligence, cloud computing and digital infrastructure. 

TCS led the IT pack, climbing the most during the rally. Source: NSE

The sector has faced pressure in recent sessions amid concerns over subdued discretionary technology spending, uncertain demand in key overseas markets and the potential disruption that generative AI could cause to traditional IT services. 

Friday’s rally offered some respite, with large-cap technology stocks leading the recovery. 

Nvidia Boosts AI Optimism 

Nvidia’s latest results and outlook provided the key trigger for the global technology rally. 

The U.S. chipmaker forecast roughly 70% revenue growth for its fiscal year ending January 2028, reinforcing expectations that demand for AI infrastructure remains strong despite concerns over stretched valuations across the technology sector. 

Nvidia shares surged 8.7% on Thursday, while the S&P 500 technology sector gained more than 3%. 

The sharp gains reflected renewed optimism that the massive investments being made by technology companies in AI infrastructure can translate into sustained revenue growth. 

For Indian IT services companies, stronger AI adoption could create opportunities in consulting, cloud migration, data services and enterprise AI implementation. 

Indian IT Stocks In Focus 

TCS, Infosys and HCLTech are among the Indian technology majors with significant exposure to global enterprises and therefore remain sensitive to changes in technology spending in the U.S. and other developed markets. 

Tech Mahindra could also benefit from improved sentiment towards technology services, particularly if the recovery in global IT spending broadens beyond AI infrastructure providers to traditional software and digital-service companies. 

However, investors may remain selective. The sector continues to face challenges from uncertain macroeconomic conditions, currency movements and pricing pressure, while the pace at which AI-led productivity gains translate into incremental spending remains a key question. 

Nifty IT Rally Lifts Market Sentiment 

The IT rally came a day after an unusually volatile session in Indian equities. The Nifty 50 fell 0.48% on Thursday to 24,090.85, while the Sensex experienced sharp swings during the closing auction. 

Friday’s technology-led rebound could therefore provide some support to the broader market, particularly given the heavy weight of IT stocks in benchmark indices. 

Investors, however, will also track Federal Reserve Chair Kevin Warsh’s comments at the Jackson Hole symposium for clues on the U.S. interest-rate outlook. Any shift in expectations around monetary policy could influence global technology valuations and flows into emerging markets. 

For now, Nvidia’s strong outlook has provided a much-needed positive trigger for Indian IT stocks. Whether the gains hold will depend on the sustainability of the global AI trade, developments in U.S. monetary policy and signs of a broader recovery in technology spending. 

Source

• NSE