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IT index rises nearly 2%, snaps 6-day losses on hopes of end to US govt shutdown; Infosys, HCLTech rise up to 3%

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  Published in Stocks and Investing on Monday, November 10th 2025 at 4:56 GMT by moneycontrol.com
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Indian IT Index Bounces 2 % After Six Days of Decline: Analysts Point to U.S. Government Shutdown Resolution

A surge of optimism has revived the Indian Information Technology (IT) sector after a protracted slump of six days. The Nifty IT index surged by 1.98 %, lifting the sector to a fresh high, buoyed by gains from leading IT service firms such as Infosys, HCL Technologies, Tech Mahindra, and Wipro. The rally is seen as a direct response to fresh news that the United States federal government has been able to avoid a shutdown, a development that has bolstered investor sentiment across global markets.

1. The Market Landscape

The Nifty IT index – which tracks 35 of the largest IT companies listed on the National Stock Exchange – climbed to 30,562.95, marking a gain of 590.90 points. This rebound follows a six‑day dip, the most significant of which saw the index fall by nearly 700 points. While the IT index rebounded, the broader Nifty 50, which represents the 50 largest companies on the NSE, edged up only marginally to 22,152.30, reflecting a 0.12 % gain of 26.30 points. Meanwhile, the BSE Sensex, India's benchmark index comprising 30 blue‑chip stocks, rose 0.10 % to 55,411.80.

The rally was underpinned by a surge in the IT sector’s heavyweights. Infosys gained 2.42 %, HCL Technologies surged 4.12 %, Wipro advanced 1.78 %, and Tech Mahindra gained 2.05 %. These gains helped lift the index as a whole, though other sectors – notably pharmaceuticals and consumer staples – displayed modest gains of 0.45 % and 0.33 %, respectively.

2. Why the U.S. Government Shutdown Matters

The United States is currently grappling with a stalemate between the Democratic‑led House of Representatives and the Republican‑led Senate over the federal budget. As the fiscal year’s deadline approached, fears of a U.S. government shutdown were at their peak. A shutdown would halt federal operations, potentially sending shockwaves through global financial markets and causing a sell‑off in equities worldwide.

However, recent bipartisan negotiations culminated in a short‑term funding agreement, averting the shutdown. This development was welcomed globally, as it removed a major source of uncertainty for multinational IT service providers. Many of India’s IT giants rely heavily on U.S. contracts, and the resolution of the shutdown threat has reassured clients and investors alike that their projects will not be delayed.

3. Ripple Effects on Currency and Commodities

The rupee's movement against the U.S. dollar further amplified the IT rally. The INR/USD pair traded at 83.90 during the session, a slight depreciation of 0.23 %. A weaker rupee makes Indian IT exports cheaper for overseas clients, potentially boosting the earnings of IT firms.

Commodity markets also displayed supportive moves. Gold fell 0.32 % to ₹1,77,600 per 10‑gram, while copper rose 0.39 % to ₹9,400 per kg. These movements reflect a partial shift from risk‑off to risk‑on sentiment following the U.S. government shutdown news.

4. Company‑Level Highlights

• Infosys: The largest Indian IT service company posted a 2.42 % gain, bringing its 52‑week high to ₹1,470. The company cited improved margin projections for the fiscal year and a boost in order backlog, especially in cloud and digital transformation segments.

• HCL Technologies: Rising 4.12 %, HCL saw its share price cross ₹2,400 for the first time since December 2023. The company's earnings outlook was revised upward due to higher demand for cybersecurity solutions.

• Wipro: Wipro's 1.78 % gain reflects better-than‑expected results from its data analytics and consulting division, which saw a 5.3 % increase in revenue.

• Tech Mahindra: The company gained 2.05 % as investors took note of its strategic partnership with a leading U.S. cloud provider, expected to generate new revenue streams in the upcoming quarter.

5. Broader Economic Context

India’s macro‑economic indicators remain supportive. The Reserve Bank of India (RBI) maintained a policy rate of 6.75 %, while inflation eased slightly to 4.3 % in September. The government announced a fiscal deficit target of 3.0 % of GDP for FY 2025–26, signifying fiscal prudence.

Global equity markets echoed the positive sentiment. U.S. indices such as the S&P 500 and Nasdaq Composite recorded modest gains, buoyed by earnings reports from major IT firms. Meanwhile, the Eurozone's Euro Stoxx 50 and UK’s FTSE 100 posted slight rises as the European debt‑crisis worries receded.

6. Key Takeaway for Investors

The overnight resolution of the U.S. government shutdown appears to be the catalyst for the IT index's recent rebound. Investors are likely to keep a close eye on subsequent earnings announcements from major IT firms, particularly as they navigate the evolving demand for digital and cloud services. In the short term, the IT sector looks poised for continued upside, with the risk of further market volatility largely mitigated by the resolution of the U.S. budget impasse.

7. Additional Context from Related Articles

1. U.S. Government Shutdown and Its Global Implications – A Moneycontrol piece outlining how the shutdown could have disrupted global supply chains, especially in the technology sector. The article explained that a shutdown would affect federal agencies that often procure IT services, thereby affecting revenue streams for many Indian IT firms.

2. Monetary Policy Update – Another Moneycontrol article highlighted RBI’s recent decision to keep the repo rate unchanged, citing inflationary pressures and a steady growth outlook. This policy stance helps maintain investor confidence in domestic equities.

3. Tech Mahindra’s Partnership Announcement – A follow‑up article detailed Tech Mahindra’s collaboration with a U.S. cloud provider, noting that the partnership is expected to deliver 15–20 % growth in the cloud segment for the next fiscal year.

8. Bottom Line

The Nifty IT index’s resurgence after a six‑day slide underscores the profound impact that macro‑economic and geopolitical developments can have on sectoral performance. As the U.S. government stabilizes, Indian IT giants stand to benefit from renewed confidence, potentially driving further gains in the near term. Investors should remain vigilant to earnings reports, contract announcements, and any new developments in the U.S. political landscape that may influence global markets.