IT Stocks Fall as Fed’s December Rate Cut Hopes Fade

Indian IT stocks witnessed sharp selling pressure on November 14 as global cues turned negative. Rising expectations that the US Federal Reserve may keep interest rates unchanged in its December FOMC meeting triggered a fresh round of profit booking across major IT counters.

The Nifty IT index slipped more than 1% to 36,294 during early Friday trading, making it the top sectoral loser for the day. This also marked the index’s second straight session of declines, signalling sustained weakness in the sector.

Why IT Stocks Are Falling?

The weakness in Indian IT companies like Infosys, Tech Mahindra, and Wipro is directly linked to the shift in sentiment around US interest rates. Since a large portion of IT revenue comes from US clients, any change in Fed policy tends to impact market expectations for the sector.

Fed Rate Cut Hopes Fade

A growing number of Federal Reserve policymakers have recently indicated that it may be too early to ease policy rates.

San Francisco Fed President Mary Daly, formerly supportive of a December rate cut, stated that taking a firm stance about the next meeting—still four weeks away—would be “premature.”

Key Highlight:
“A growing number of Fed officials now believe that cutting rates further may not be necessary.”

This shift in tone has dampened the market’s expectations of a rate cut, strengthening the US dollar and putting pressure on rate-sensitive sectors like IT.

Also Read: Muthoot Finance Q2 Profit Jumps 87% to Rs.2,345 Crore; Board Clears Rs.35,000-Crore NCD Issue

Nifty IT Index Extends Losses

With the new Fed commentary weighing heavily on global tech sentiment, the Nifty IT index continued to remain under pressure:

• Down over 1% in early trade

• Trading around 36,294

• Second consecutive session of losses

• Infosys, Tech Mahindra, and Wipro are listed among the top Nifty losers

Important:
The sharp fall in IT stocks clearly reflects rising uncertainty about the Fed’s December policy decision.

What Investors Should Watch Next

Market participants will closely track:

• Federal Reserve officials’ upcoming speeches

• Economic data from the US

• Any hints about the December policy stance

• Global tech sector trend and NASDAQ movement

While the current tone appears cautious, the actual policy direction will only be confirmed at the December FOMC meeting.

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