Indian IT and some IT-enabled tech stocks are widely considered to be a shadow of the Nasdaq index. However, such a trend is not seen in today’s time. The Nasdaq has gained 15 per cent in the past month, but Indian IT and tech stocks have been almost unchanged from this rally. Google’s share price on the Nasdaq rose 18 percent over the past month, while the platform’s share price rose 46 percent during this time.
According to stock market experts, better results reported by index heavyweights led Nasdaq to gain momentum and this is a short-term rally as inflation and recession fears still remain. we economy. Market experts said that there has been some outflow of money from the market. U.S. Dollar The dollar index has moved to a 10-month low, as have equities. So people are booking profits in dollars and switching money from currency to equity. He also said that investors have also moved towards US equity markets as US Fed interest hike is nearing peak.
Talking on the reason for Nasdaq index rally, Sandeep Pandey, Director, Basav Capital said, “Nasdaq has rallied not because of change in market sentiment but because of stock specific outlook by investors. Some Nasdaq heavy weights like meta reported strong quarterly results that attracted the bulls on Wall Street. The fear of economic slowdown and inflation is still looming there and hence Indian IT and IT enabled tech companies, Who Most of its business from the US and Europe is still in limbo. Their order book is still not the size they are used to. In fact, some Indian IT companies have reported better Q3 results, but it is a big challenge for them to retain their employees and combat attrition as their margins are still not improving properly.”
The former deputy vice president of HDFC Bank further said that companies like Google, Meta etc have managed to post better numbers as they resorted to layoffs to keep their margins under control. These companies are yet to see an increase in their business volumes.
On the fundamentals that helped Nasdaq rally, Saurabh Jain, Vice President-Research, SMC Global, said, “The dollar index has hit a 10-month low and hence those who had positions in the currency have started booking profits and money has begun to switch to the US equity market as the US Fed’s interest rate increase almost reached its peak. Thus, investors are shifting their money to equity and in such a scenario Nasdaq listed stocks with better quarterly numbers are attracting their attention and investment.”
Disclaimer: The views and recommendations given above are those of individual analysts or broking companies and not of Mint. We advise investors to do due diligence with certified experts before making any investment decision.
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