Indian benchmarks ended Friday with their best week in six months, snapping a months-long slump. The Sensex added 3.1% to close at 74,729, while the Nifty 50 jumped 2.8% to 23,146. It was their strongest weekly showing since April 10. On the day, both indexes gained roughly 0.7% and 0.6% respectively.
The engine behind this move? IT stocks. The Nifty IT index surged 3.9% on Friday, pushing its weekly gain to 11.7%—the steepest in 18 years. TCS, Infosys, HCLTech, and Tech Mahindra led the charge, climbing between 13.4% and 18.2% on the week. They were among the Nifty 50’s top percentage gainers. Saurabh Jain, deputy VP of equities at SMC Global, noted that "the absence of any major negative surprises from IT earnings, coupled with management commentary pointing to growing AI-led revenue, has given investors confidence to return to these beaten-down names."
This domestic strength stood in stark contrast to global tech. MSCI’s broadest index for Asia Pacific stocks outside Japan fell 5.8% over the same period. A global AI selloff seemingly prompted value-buying in Indian IT, allowing domestic investors to capitalize on the dip. The rupee also strengthened by 10 paise, closing at 94.96, buoyed by Reserve Bank of India policy measures aimed at supporting the currency.
But the rally may hit a pause next week. Jain warned that "the market, and IT shares in particular, could pause next week as the Jio Platforms IPO absorbs liquidity." Investors are also braced for results from heavyweight banks like ICICI Bank and HDFC Bank, due on Saturday. These earnings, along with the Jio IPO, will determine whether the current momentum sustains or fades.