While the Dow notched its second closing record in a row with a small gain, the S&P 500 ultimately finished short of its closing record.The S&P 500 technology sector finished up 1.6% to extend Friday's gains after a steep selloff last week. The S&P 500 Software ‌Services index ended up ‌2.9% as it clawed back some losses for a second day after a bruising seven days of losses fueled by fears that AI could intensify competition.One big gainer in software was Oracle, which added 9.6% after D.A. Davidson upgra ...

highlights our first editorial. At Davos, Anthropic founder and CEO Dario Amodei suggested that AI could perform most tasks done by engineers within a year, a statement that amplified investor anxiety. For firms built on billing by time and manpower, the model looks directly challenged, and even large SaaS platforms face questions about relevance. Anthropic’s launch of Claude Cowork has unsettled the global technology industry, erasing vast market value within days and hitting Indian IT majors particularly ...

Core Viewpoint - The Indian market is currently facing challenges, including a weakened rupee and underperformance in earnings growth, particularly in the software services sector, despite signs of potential recovery and foreign inflows [7][11][12]. Economic and Market Performance - India's economic growth has outpaced rivals, yet it experienced its worst underperformance against emerging markets in decades, with foreign investors withdrawing a record $19 billion from local stocks last year [7][12]. - Over the past 12 months, the MSCI India Index has gained 8%, while the MSCI Emerging Markets Index surged nearly 38%, indicating a significant disparity in performance [7][12]. - Earnings growth for the MSCI India Index is projected at about 8.3% over the next year, lagging behind regional peers such as China (16%), South Korea (108%), and Taiwan (30%) [11][12]. Tariff Changes and Trade Agreements - The U.S. has eliminated a punitive 25% tariff on Indian goods related to Russian oil purchases and reduced a reciprocal duty on Indian goods from 25% to 18%, providing relief to Indian exporters [8][9][12]. - The new tariff rates are expected to positively impact Indian exporters, who previously faced some of the highest tariffs in Asia [9][12]. - India has committed to purchasing $500 billion worth of American products over five years, which includes aircraft, graphics processing units, and energy, while also promising to reduce non-tariff barriers for U.S. companies [9][14]. Currency and Valuation Insights - The Indian rupee is currently viewed as undervalued, with its real effective exchange rate near a decade low, which may support macroeconomic fundamentals and earnings growth in the coming year [11][14]. - The Indian market trades at about 22 times forward earnings estimates, which is in line with its long-term average but still at a premium compared to other emerging markets [11][12]. Investor Sentiment and Future Outlook - There are signs of tentative improvement in Indian equities, with a second consecutive week of foreign inflows, a trend not seen since October [7][12]. - Some investors express bullish sentiment, suggesting that recent trade deals and the state budget could lead to a significant market rally, with a focus on quality companies positioned for future growth [12][14]. - Despite the positive sentiment from tariff reductions, analysts caution that the agreement does not fundamentally alter GDP growth or equity earnings outlooks for the next 12 months [12][14].

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We're heading into a gauntlet of tech earnings and a Fed decision and the big question is whether this rally is built on solid ground or just holding its breath. Vince Luso is president and CEO and portfolio manager at Cloud Capital. He joins us now.Vince, thanks so much for being here. >> Thanks for having me. >> So, set the stage for us here in a week with so much noise.Do you just kind of sit on your hands and wait it out or is this where the real money is made. Yeah, I wish we could wait it out sometime ...

Core Insights - India's top offshoring firms reported a significant increase in billion-dollar contracts, indicating a competitive landscape in the $283-billion sector as companies vie for market share [1][2] Group 1: Mega Deals and Market Dynamics - In the October-December quarter, Cognizant, Tata Consultancy Services (TCS), and Infosys collectively secured three mega deals, the highest in nine quarters, focusing on AI-driven transformations of clients' IT infrastructure [2][4] - Companies are consolidating their vendor relationships to lower long-term software service costs, leading to a shift towards platform-scale transformation deals rather than traditional labor-heavy outsourcing [3][6] - TCS won a significant contract from a North American financial institution, while Cognizant secured a $1-billion deal with Novartis for managing AI-led services [4][5] Group 2: Financial Performance and Projections - Infosys obtained a 15-year IT modernization contract worth $1.6 billion with the UK's NHS, showcasing the trend of long-term, high-value contracts [5] - HCLTech reported advanced AI revenue of $146 million, reflecting a 19.9% sequential growth, indicating a rising demand for AI services [8] - TCS ended the previous year with $1.8 billion in annualized AI revenue, with Gen AI being its fastest-growing vertical, achieving a 17.3% quarterly growth [9] Group 3: Industry Challenges and Margin Concerns - Analysts express concerns over shrinking margins across traditional IT services, as companies invest heavily in talent and infrastructure for mega contracts, which may inflate initial costs [6][14] - Infosys's margins narrowed by 30 basis points to 20.7% in FY24, while HCLTech's margins remained stable at 18.2%, and TCS reported a 50 basis point improvement to 24.6% [15]

Core Insights - The article highlights the increasing role of artificial intelligence in driving technology deals among Indian software services providers as they transition from AI test deployments to larger projects [1] Group 1: Industry Trends - Indian software services companies are actively competing for technology deals that are increasingly centered around artificial intelligence [1] - The shift from pilot projects to substantial AI implementations indicates a growing confidence in AI technologies among businesses [1] Group 2: Company Perspectives - Wipro's CEO, Srini Pallia, emphasizes the importance of AI in the company's strategy and its potential to unlock new business opportunities [1]

Core Insights - The article provides an overview of the performance of various mutual funds, highlighting the top and bottom performers based on net asset value changes [1] Fund Performance Summary Top Performing Funds - The top 10 mutual funds with the highest net value growth on January 12 include: 1. Western Gain Technology Innovation Mixed A: 2.0717, up 14.17% 2. Western Gain Technology Innovation Mixed C: 2.0544, up 14.16% 3. Dongcai Excellent Growth A: 1.7720, up 13.95% 4. Dongcai Excellent Growth C: 1.7431, up 13.95% 5. Shenwan Lingxin Le Dao Mixed: 1.5309, up 13.91% 6. Yongying Information Industry Smart Selection Mixed A: 1.1660, up 13.65% 7. Yongying Information Industry Smart Selection Mixed C: 1.1593, up 13.63% 8. Furong Information Technology Mixed A: 1.2683, up 13.60% 9. Furong Information Technology Mixed C: 1.2471, up 13.59% 10. Rongtong Mingrui Mixed A: 1.8205, up 12.73% [2] Bottom Performing Funds - The bottom 10 mutual funds with the lowest net value growth on January 12 include: 1. Guolian An Technology Power: 2.5223, down 2.13% 2. Nongyin Medical Healthcare Stock: 1.7954, down 2.02% 3. Nongyin Innovation Medical Mixed: 0.9889, down 2.00% 4. Guolian An Preferred Industry Mixed: 4.0370, down 2.00% 5. Dongfang Alpha Advantage Industry Mixed A: 2.0354, down 1.88% 6. Dongfang Alpha Advantage Industry Mixed C: 1.9799, down 1.88% 7. Shanzheng Asset Management Strategy Selected Mixed C: 1.8316, down 1.88% 8. Shanzheng Asset Management Strategy Selected Mixed A: 1.8293, down 1.87% 9. Guolian An Science and Technology Innovation Mixed: 1.1816, down 1.80% 10. Caitong Asset Management Innovation Medical Mixed C: 1.4992, down 1.74% [3] Market Analysis - The Shanghai Composite Index opened high and continued to rise, closing with a significant increase, while the ChiNext Index rebounded after a dip. The total trading volume reached 3.64 trillion, with a gain-loss ratio of 4144:1182 and a limit-up-limit-down ratio of 201:9 [5] - Leading sectors included software services, internet, media and entertainment, and advertising packaging, all with gains exceeding 6%. Notable concepts included Sora and AI marketing, both with gains over 10% [5]

Company Performance - HCLTech reported a third-quarter revenue of 338.72 billion rupees ($3.8 billion), a 13.3% increase year-over-year, surpassing analysts' expectations of 330.46 billion rupees [1] - The company's profit for the quarter decreased by 11.2% to 40.76 billion rupees, falling short of the average estimate of 46.81 billion rupees [4] - AI revenue reached $146 million, up from $100 million in the previous quarter, marking the first time the company disclosed this breakdown [4] Revenue Growth Forecast - For fiscal year 2026, HCLTech narrowed its revenue growth forecast to 4% to 4.5%, down from a previous range of 3% to 5% [2] Sector Trends - The Indian IT industry, valued at $283 billion, is expected to report muted performance due to weak demand in the U.S. as clients delay non-essential tech spending amid macroeconomic uncertainties [2] - Holiday-period shutdowns typically affect earnings in the December quarter, but HCLTech does not usually experience a year-end slump due to product license renewals during this period [3] Business Segments - Revenue from banking and technology verticals grew by 8.1% and 14.4% respectively, while revenue from life sciences declined by 2% [5] - New deal bookings for the quarter amounted to $3 billion, an increase from $2.57 billion in the previous quarter and $2.09 billion in the same period last year [5] Market Context - HCLTech's shares closed 0.37% higher ahead of the results, indicating positive market sentiment [5] - Tata Consultancy Services, a major competitor, also exceeded revenue estimates, while Infosys, Wipro, and Tech Mahindra are set to report their results later this week [6]

Core Insights - Tata Consultancy Services (TCS) reported third-quarter revenue of 670.87 billion rupees ($7.44 billion), slightly exceeding analyst expectations of 666.76 billion rupees, driven by AI demand [1][2] - The North America market, which constitutes nearly half of TCS's revenue, experienced growth for the first time in two years, indicating a potential recovery in demand [3] Financial Performance - TCS's consolidated revenue increased by 4.9% year-over-year [1] - The company's net profit fell by 14% to 106.57 billion rupees, missing analyst estimates of 130.24 billion rupees, attributed to one-time restructuring costs and legal expenses [5] - TCS's total order book decreased to $9.3 billion from $10.2 billion a year ago, despite announcing eight deals in the quarter, the highest among India's top-five IT firms [6] Market Dynamics - AI services generated $1.8 billion in annualized revenue, accounting for approximately 5.8% of TCS's overall revenue [2] - Five out of eight geographical markets showed growth, with the Middle East Asia growing by 8.3% and Continental Europe by 3.5% [2] - Clients in the IT industry remain cautious about tech spending due to macroeconomic uncertainties, including U.S. tariffs and visa fee challenges [4]