IT stocks fall as US judge upholds $100k H-1B fee; check details

Shares of Indian information technology (IT) stocks slipped in trade on Wednesday after a US court upheld the US President Donald Trump administration’s plan to impose a $100,000 fee on new H-1B visa applications.

 

Coforge was among the worst performers on the Nifty IT gauge, falling as much as 2.2 per cent. Wipro shares were down 1.1 per cent, while the Infosys counter was lower by 1 per cent. HCL Technologies and Tech Mahindra fell 0.6 per cent and 1 per cent, respectively. 

 

As of 10:35 AM, Coforge and Infosys shares were down 1.26 per cent and 0.25 per cent, respectively. Wipro was down 0.74 per cent, compared to a 0.20 per cent advance in the benchmark Nifty50 index. The Nifty IT index fell as much as 0.69 per cent on Wednesday's trading session. 

 

So far this year, the Nifty IT index is down 9.8 per cent, compared to an 11 per cent advance in the Nifty index.   READ STOCK MARKET LIVE UPDATES TODAY

H-1B visa application fee upheld

In September this year, Donald Trump signed an executive order raising the H-1B application fee to $100,000, from the earlier $2,000–5,000. However, the White House has clarified that the levy applies only to initial petitions, not renewals, re-entries or existing holders, easing fears of a recurring or blanket cost burden.

 

Analysts earlier noted that the impact on large companies will likely be limited, while the problems may be more acute for mid-tier firms. 

 

Meanwhile, a federal judge, on Tuesday, said the Trump administration can move ahead with a $100,000 fee on new H-1B visa applications. US District Judge Beryl Howell said in a ruling that Trump’s move to radically increase the cost of the popular visa is lawful. The US Chamber of Commerce, which sued to block the proposal, can appeal.

 

Howell rejected the Chamber's argument that the president doesn’t have the power to impose the fee, finding that his proclamation was issued under "an express statutory grant of authority to the President," according to a Bloomberg report.   ALSO READ | VIP Industries shares jump 9% amid large trades; check all details here

Accenture results 

Accenture reported that its revenue grew 5 per cent on the year to $18.7 billion in the first quarter of the current financial year in constant currency terms, according to Nomura. The IT company reported 4 per cent organic growth. Financial services, which expanded 12 per cent, led growth among verticals, according to the brokerage. 

 

Post Accenture results, brokerages said that the outlook for Indian IT companies will likely have a steady operating environment in the near term. Resilience in financial services-led demand and improving outsourcing momentum will support the environment even though discretionary spending will likely remain muted.