The Trump administration has targeted major Indian IT companies including Infosys, Tata, Wipro, and HCL Technologies over alleged visa abuse, threatening a sector already struggling with global investor shifts toward AI stocks. US-listed shares of Infosys surprisingly closed higher, while Wipro remained unchanged, offering little relief amid broader market anxiety. India's financial markets are under severe pressure, with stocks at an 18-month low and the rupee hovering near a record low of 96.9650 per dollar.
The benchmark Nifty 50 is on track for its ninth consecutive weekly decline unless it rallies significantly on Friday. The Reserve Bank of India (RBI) is actively defending the currency, but its foreign-exchange reserves have dropped by more than $50 billion in just four weeks, raising concerns about the sustainability of its intervention strategy. Elevated oil prices, foreign outflows, and weak sentiment continue to weigh on the rupee, with Governor Sanjay Malhotra suggesting it may be undervalued, though market confidence remains low.
Despite the challenges, software bellwether TCS reported stronger-than-expected September-quarter earnings, though analysts caution that the headline numbers may not fully reflect underlying complexities. The RBI faces a difficult balancing act: curbing currency volatility without depleting its reserve buffer too quickly. Meanwhile, India-focused healthcare firms are expected to outperform in the second quarter, driven by strong local market growth in sectors like cardiac care and diabetes, while automakers may see gradual margin recovery amid improving demand and EV adoption.
Source: Bloomberg Markets · Summarized by HeadlinesBriefing