IT stocks decline as rupee strengthens

Shares of four IT companies fell by 0.26% to 1.37% at 14:30 IST on BSE as rupee strengthened past 67 against the dollar.

Meanwhile, the S&P BSE Sensex was up 249.56 points or 0.88% at 28,755.86.

HCL Technologies (down 0.26%), Tech Mahindra (down 1.37%), TCS (down 1.1%) and Wipro (down 0.47%) declined. Oracle Financial Services Software rose 0.2%. A firm rupee adversely affects operating profit margins of IT firms as the sector derives a lion's share of revenue from exports.

In the foreign exchange market, the partially convertible rupee was currently hovering at 66.7675, compared with closing of 67.02 during the previous trading session.

 

The BSE IT index had underperformed the market over the past one month till 21 September 2016, falling 1.57% compared with 1.53% rise in the Sensex. The index had also underperformed the market in past one quarter, dropping 10.09% as against Sensex's 6.32% rise.

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