Why are IT stocks surging today?

Indian IT stocks rallied today, driven by strong earnings reported by US-based IT services giant Accenture, which exceeded market expectations. Accenture’s better-than-expected quarterly results, especially its forecast of a 3 per cent to 6 per cent revenue growth in fiscal 2025, ignited optimism for the performance of Indian IT firms.

At the market's opening, Indian benchmark indices—Nifty 50 and BSE Sensex—traded flat, with the Nifty 50 hovering around 26,248.25 points and the Sensex inching to a record high of 85,935.31. However, while financial stocks dragged the broader indices due to a 0.4 per cent decline, the IT sector surged nearly 3 per cent in morning trade. Market leaders such as Tata Consultancy Services ( TCS ), Infosys , Wipro , and HCLTech saw gains between 1.7 per cent and 3.5 per cent.

HCL Tech on Friday surged 2.5 per cent to an all-time high of Rs 1,828.55 apiece on the National Stock Exchange.

This positive sentiment follows Accenture's report of robust demand for its AI services, generating $1 billion in bookings for the quarter and $3 billion for the full year. Accenture also posted fourth-quarter revenues of $16.4 billion, reflecting a 3 per cent increase year-on-year. The company's strong performance and forecast for fiscal 2025 fuelled optimism in India’s IT sector, with expectations that local IT firms, heavily reliant on US clients, could benefit from a similar demand.

Despite the overall muted opening, the IT sector's rally highlights investor confidence in the tech industry’s growth potential. Analysts believe that continued growth in AI and digital transformation services will help Indian IT companies sustain strong performance in the coming quarters.