Nearly 30% of the stock's value has been eroded over the past year.
Multiple developments shaped Tata Consultancy Services’ (TCS) trade on Thursday. The stock was down 1.5% at ₹3,111 at the time of writing.
According to an Aug. 28 press release, it partnered with Philippines-based Unilab to modernize the pharmaceutical and healthcare company’s core business systems through a cloud migration.
It also signed a 1.4 million sq ft office lease in Bengaluru on Thursday, highlighting its growth prospects.
According to an internal memo to its employees, the software services giant is integrating all its existing teams and capabilities in artificial intelligence (AI) to create a new AI and Services Transformation unit, with TCS veteran Amit Kapur leading the unit globally.
However, the primary reason behind the stock movement is likely the reason dragging the IT sector lower: a 50% tariff on Indian exports imposed by U.S. President Donald Trump.
The Nifty IT index was down 1.1%, with HCL Technologies (-2.5%), TCS, and Infosys (-1.6%) leading the declines.
Technical View
The stock has been trending downward, consistently forming lower highs and lower lows. It is currently hovering near the 50% retracement zone at around ₹3,112, a level that has earlier acted as a support, noted SEBI-registered analyst Manish Kushwaha.
Buyers have shown signs of defending the ₹3,100 mark in recent weekly candles, but a clear confirmation of reversal remains absent. Trading volumes are average, with no strong breakout candle observed yet, he said.
Kushwaha sees immediate support at ₹3,100, followed by a deeper cushion near ₹2,700. On the upside, resistance is observed in the ₹3,300- ₹3,500 range, which also aligns with a trendline and the 38.2% Fibonacci retracement level.
Kushwaha said a breakout above ₹3,500 could trigger a rally toward ₹3,800-₹4,000, while a fall below ₹3,100 may pull the stock down to ₹2,700, with further downside towards ₹2,200-₹2,000 also possible.
Stock Watch
Retail sentiment for TCS remained ‘bearish’. Over the past year, sentiment around the stock has generally been bearish, as per Stocktwits data.
During the one-year period, the stock came under heavy selling pressure, losing nearly 30% in value.
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