It’s a busy week for the Indian IT sector. Close on the heels of the TCS and HCLTech earnings last week, Infosys will be declaring its Q1 earnings on July 18 followed by Wipro Q1 earnings on July 19. The tech stocks have responded to the hectic earnings action in the IT sector and have been on a gaining spree. 

Nifty IT Index- A look at July performance 

On July 12, the Nifty IT rallied over 5% to a high of 39,237, intra-day after Tata Consultancy Services reported a strong Q1 FY25 result. All the constituents of the sectoral index traded in the green on July 12. So far, the Nifty IT index has clocked 3.86% gains in the past 5 days. For July so far, the Nifty IT index is up 6.16%. Interestingly in 14 of 21 years, the Nifty IT index has delivered positive returns in July. 

Talking on the technical side, Rajesh Palviya, Senior Vice President of Research and Head of Technical & Derivatives at Axis Securities said that most of the large-cap and midcap IT stocks managed to give a breakout on the short-term charts, which indicates at least another 3-4% up move in the near term. Similarly, the Nifty IT index also managed to give a breakout to its previous swing high of Feb 2024. Most of the IT stocks witnessed a short-covering action on the derivatives front. “Nifty IT index is likely to scale up to the level of 39500-39700 in the near term, said Palviya.  

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How has the Nifty IT performed in Q1 

If we look at the performance of the Nifty IT index between April – June, the index is up 3.18%. The top gaining stocks in this period comprise Infosys, Tech Mahindra, Mphasis, and others.

Nifty IT Index- What happened in Q4 

In the previous quarter, the sectoral index constituting IT services stocks fell 2.23%, while the benchmark index Nifty 50 gained 2.7% in the same time frame. The key IT stocks Infosys, Wipro, TCS, and HCLTech all clocked losses between 2.45%-12.2%% in April.

Nifty IT Index Vs Nifty

The Nifty IT has given a return of 13% in the last one month. It has risen around 9.5% from year to date and raised the value by 34% in the past one year. To compare, the Nifty 50 has given a return of 5.2% in the last one month. The index comprising 50 stocks has risen almost 13% from year to date. It has increased 27% in the last one year, underperforming the Nifty 50.