IT stocks buck trend after rupee breaches 60 mark

Mahindra Satyam (up 3.88%), Tech Mahindra (up 3.27%), Hexaware Technologies (up 3.05%), TCS (up 2.51%), CMC (up 1.74%), HCL Technologies (up 1.72%), Oracle Financial Services Software (up 1.08%), Wipro (up 0.68%) and Infosys (up 0.39%), edged higher.

The BSE IT index was up 1.46% to 6,005.62. It outperformed the BSE Sensex, which was down 0.38% at 18,557.62.

The BSE IT index had outperformed the market over the past one month till 25 June 2013, falling 0.60% compared with the Sensex's 5.46% fall. The index had, however, underperformed the market in past one quarter, sliding 12.66% as against Sensex's 0.28% fall.

The rupee was hovering at 60.37 against the dollar, weaker than Tuesday's close of 59.66/67. The Indian currency is declining as global investors are pulling out of emerging markets broadly amid concerns over the reduction of a US program that has injected billions of dollars into the global financial system. A weak rupee boosts revenue of IT firms in rupee terms as the sector derives a lion's share of revenue from exports.

Positive economic data in the US also aided gains in IT stocks. The US Commerce Department said orders for goods built to last at least three years rose 3.6% in May. Another report from the Commerce Department indicated new-home sales rising 2.1% last month. Separately, the S&P/Case-Shiller index of home values rose 12.1% in April from a year earlier, the biggest jump in more than seven years. The Conference Board's consumer-confidence index rose to 81.4 in June from 74.3 in May. US is the biggest outsourcing market for the Indian IT firms.

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