TCS, Wipro to Infosys: Why are Indian IT stocks falling after Accenture share price crash — explained

livemint.com:

Stock market today: After weak guidance delivered by Accenture, the share price of the global IT major crashed over 9 percent at the New York Stock Exchange (NYSE). This led to a drop in the ADR (American Depository Receipt) shares of the Indian IT majors Wipro and Infosys. Accenture share price witnessed a sharp sell-off after the IT giant revised its full-year revenue growth expectation to 1 percent to 3 percent, which is lower than the early estimates of 3 percent to 5 percent.

This significant drop in the Accenture revenue guidance hit Indian IT shares in early morning deals on Friday as the Nifty IT index is down to the tune of 3 percent. Indian IT majors Wipro, Infosys, Tata Consultancy Services (TCS), and HCL Technologies are trading red after a huge drop against their Thursday close. This sell-off in the IT stocks dragged the Indian stock market into red territory as the Nifty 50 and Sensex today dipped around 0.30 percent in the early morning session.

Expecting sell-off pressure in the Indian IT stocks during Friday deals, Avinash Gorakshkar, Head of Research at Profitmart Securities said, "Accenture share price crashed in US stock market after the weak guidance of the global IT major. This led to weakness in the ADR shares of Infosys and Wipro as well. As Indian IT stocks follow their ADR shares' performance in the US stock market, Indian IT stocks are trading in the red zone in early morning deals on Friday." Avinash Gorakshkar went on to add that Accenture provides a good amount of business to Indian IT companies.