On Thursday, shares of Infosys and Wipro experienced a notable decline on the New York Stock Exchange (NYSE), influenced by the recent earnings report from Accenture. The performance of Infosys saw its American Depository Receipts (ADRs) decrease by 3.5% to settle at $17.9, while Wipro faced a 3.2% drop, closing at $2.79. This downturn occurred even as Accenture raised its lower revenue forecast for the year, indicating a mixed response from investors.
What Sparked the Decline?
Accenture, a leading player in the global IT services arena, released its second-quarter earnings, adjusting its revenue growth expectations upward. The company now anticipates annual revenue growth to fall between 5% and 7%, a slight increase from its previous forecast of 4% to 7%.
Despite this positive adjustment, market experts were looking for a more robust forecast, aiming closer to 5.7%. This less-than-expected guidance led to a wave of selling among investors, significantly impacting the ADRs of both Infosys and Wipro.
The Broader Impact on the IT Sector
Accenture’s earnings report is often seen as a key indicator for the IT sector, particularly for Indian technology firms that rely heavily on international IT services for revenue.
- Infosys ADRs closed at $17.9, reflecting a decline of 3.6%.
- Wipro ADRs fell to $2.79, marking a 3.2% decrease.
Domestic Market Reactions
Interestingly, the scenario back in India painted a slightly different picture. On the Bombay Stock Exchange (BSE), Infosys shares finished 1.74% higher, closing at Rs 1,614.15 after peaking at Rs 1,631 during the trading day. Meanwhile, Wipro’s stock appreciated modestly by 0.83%, ending at Rs 267.95.
This mix of reactions highlights the varying sentiment in different markets and underscores the importance of global earnings reports in shaping investor expectations. As the IT sector continues to navigate these fluctuations, staying informed about earnings releases from major players like Accenture will be crucial for stakeholders.
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