Nifty IT Index Gains 2.5% as Traders Build Long Positions
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- Nifty IT index rose 2.5% on Tuesday, ending 0.7% higher at 23,123.65, making it the top sectoral gainer.
- Mphasis surged 4.2%, while Wipro and LTIMindtree gained 3.4‑3.7%.
- Traders placed bullish derivative bets on IT stocks, with long buildup and short covering, according to Vipin Kumar of Globe Capital Market.
- Nifty IT index has gained over 11% since its March 17 low of 28,288, outpacing the Nifty’s 2% decline.
- Sudeep Shah said short covering in midcap IT stocks and fresh long buildup in large‑cap names helped the recovery.
- TCS and Infosys are viewed as better positioned to invest in AI capabilities, with IT seen as a contrarian opportunity after valuations fell, noted Sagar Shetty.
Why it matters: The rally lifts large‑cap IT firms such as TCS and Infosys, whose solid balance sheets let them expand AI capabilities, while short sellers see positions unwind. With valuations now cheaper and technical indicators turning bullish, the sector becomes a contrarian draw for investors seeking upside.
