Eight IT stocks lost 0.82% to 4.86% at 14:45 IST on BSE as Indian currency firmed up against the dollar in foreign exchange market.
Oracle Financial Services Software (down 4.86%), Infosys (down 4.84%), Wipro (down 3.11%), Tech Mahindra (down 2.39%), TCS (down 2.38%), Mphasis (down 1.62%), HCL Technologies (down 1.10%) and Hexaware Technologies (down 0.82%) edged lower. Meanwhile, Persistent Systems (up 1.29%) and MindTree (up 0.66%) edged higher.
In the foreign exchange market, the rupee edged higher against the dollar. The partially convertible rupee was hovering at 70.90, compared with its close of 70.94 during the previous trading session.
A firm rupee adversely affects operating profit margin of IT firms as the sector derives a lion's share of revenue from exports.
The S&P BSE IT was down 3.20% at 15,080.33. It underperformed the Sensex, which was up 3.16% at 39,217.05.
The broader market surged after the Finance Minister Nirmala Sitharaman on Friday, 20 September 2019, slashed corporate tax rate to 22% without exemptions. The effective corporate tax rate after surcharge now stands at 25.17%. The step has significant positive implications for corporates' profitability, broader economy and market valuations.
As on 31 March 2019, Oracle Financial Services Software paid a corporate tax of 35.44%. Infosys paid a corporate tax of 26.22%. Persistent Systems paid a corporate tax of 26.66%.
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