Accenture forecast lifts most IT stocks but near-term outlook remains hazy

On Monday, a number of Indian IT stocks experienced significant gains following Accenture's superior-than-anticipated revenue forecast for the year. Notable gains were observed in big players like Tata Consultancy Services Ltd (TCS) and Wipro Ltd, which rose up to 2%. Small companies such as Persistent Systems Ltd and Mphasis Ltd also saw a 3% increase.

However, not all IT stocks performed equally well; Infosys Ltd and HCL Technologies Ltd were among those that dropped between 1-3%, with some even briefly turning into winners before swiftly turning into losers. This led to Nifty IT, which had initially gained nearly 1.6%, ending flat compared to the previous close. The benchmark Sensex gained 472.77 points or 0.7% to close at 72,382.47, while Nifty 50 added 0.6% to close at 22,555.75.

A number of sectors like banking, financial services, and fast-moving consumer goods also witnessed robust buying, helping lift the indices. The market's recovery was credited to less robust-than-expected US jobs data and a decrease in crude oil prices, which provided some relief to investors assessing the near-term interest rate outlook.

Accenture's earnings for the June-August quarter exceeded analysts' estimates, but the bigger talking point was the higher-than-expected guidance provided for FY27. Despite this, many IT companies are expected to see only a moderate improvement in the July-September quarter due to ongoing West Asia conflict weighing on client spending and decision-making.