At close, BSE Sensex was trading 887.64 points lower at 66,684.26 and Nifty50 was trading 234.15 points lower at 19,745.00.
New Delhi: Indian indices opened lower Friday with technology sectors facing hurdles in the backdrop of Infosys slashing its revenue projection for the year. Tech major ADR’s share price tumbled 9.5 per cent in overnight trade on Nasdaq. The tech heavy index also 2 per cent, which had to have brought a rub-off effect on domestic software stocks.
Sensex opened at 66,907.07 (previous close: 67,571.90), touched a high of 67,190.52 during the day’s trade; Nifty opened today at 19,800.45 (previous close: 19,979.15), touched a high of 19,887.40 during the day’s trade. At close, BSE Sensex was trading 887.64 points lower at 66,684.26 and Nifty50 was trading 234.15 points lower at 19,745.00.
“Infosys’ share price is under deep pressure due to revenue growth guidance cut to 1-3.5 per cent from 4-7 per cent. The guidance cut was sharp. The magnitude of the cut was all the more surprising noting mega-deal announcements and a strong pipeline,” said Sumit Pokharna, Research Analyst & Vice President at Kotak Securities Ltd.
“The guidance cut is either on account of the sharp deterioration in discretionary spending or compensating for a tad aggressive guidance earlier or both. Management attributed it to cut in discretionary spending and delays in large deal closures and ramp-ups. We believe that the weaker outlook is not Infosys-specific and captures a broader slowdown, especially in key verticals, i.e. banking and telecom.”
“Nifty crashed today, ending its winning streak due to disappointing Q1 performances from INFY (-8.41%) and HUL (-3.82%). Overbought conditions and high greed contributed to the sell-off. Investors now await RIL Q1 results, expecting a consolidation around 19501 with resistance at the psychological 20000 mark. Caution is advised in this return of risk,” said Prashanth Tapse, Research Analyst, Mehta Equities Ltd.
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