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Tuesday, August 9, 2011

US shock, IT shares drop

Indian IT industry is worth $ 60 Billion, and 60% of revenue comes from the USA. USA's credit rating downgrade came heavily on IT stocks.
Credit downgrade by S&P is supposed to take US interest rates on higher side and this shall hamper the IT spending of US Company, and this is detrimental for Indian IT industry. Domestic interest rates is USA are loosely tied with interest rates of US treasury rates, and any hike in treasury rates shall raise domestic rates proportionally.

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IT stocks fell well below their 200 days EMA (DEMA) as far as Technical Analysis is concerned this is a sign of bearishness All major IT stocks likeInfosys, TCS and others fell below their 200 DEMA in past  trading days.

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