IT stocks post sharp recovery amidst Tuesday’s crash, TCS turns green

Information technology stocks made a sharp recovery on Tuesday following the initial sell-off on Tuesday morning with the Nifty IT index trading at 32,242 as of 2:05 p.m. as compared to the low of 31,320 recorded during noon trading.

Most of these stocks have given a negative return since the beginning of 2024. TCS is down about 2.78% since the beginning of the year while Wipro has lost over 8%. Persistent Systems has lost nearly 9% in the period while L&T Technology Services has declined over 15%.

Meanwhile, the benchmark indices recovered following a brutal sell-off in the first half of Tuesday’s session. The benchmark Nifty 50 and the Sensex had plunged nearly 7% during the day only to recover by 2:11 p.m. At the time of writing, the Nifty 50 was trading 5.43% lower while the Sensex was trading 5.29% lower.

Volatility abated a bit as uncertainty regarding the election outcome abated a bit by the afternoon. As early figures showed reasonable numbers for the INDIA Bloc, the India VIX shot up nearly 41% to hit as high as 31.71 on Tuesday. This is the highest level seen since February 2022. India VIX is an index that reflects the anticipated volatility in the market over the next 30 days.

In recent weeks, the index has been topping the levels of 24 as multiple sound bytes about election outcomes emanating from different corners appeared to be unsettling the markets. On Monday, the index had crashed nearly 19% as exit polls had predicted a landslide victory for the BJP-led NDA government.