Why IT Stocks Went Up: TCS Q2 Results and the Rally

IT stocks were among the biggest gainers on Friday, 9 October 2026. If you were watching the Nifty IT index, the jump was hard to miss.

A rally like this raises two questions. Why did it happen today, and does it mean anything for the weeks ahead?

This article covers the first question using TCS's own results release and reported market data. It is not a buy or sell call on any stock.

Why Did IT Stocks Go Up on 9 October 2026?

The short answer: TCS's September-quarter results gave investors the numbers they had been waiting for, in a week when the sector had been under pressure.

In morning trade the Nifty IT index reached an intraday high of 28,776.75, up more than 1,000 points from the previous close of 27,736.60. By around 11:15 AM it was at 28,623.25, up about 3.2%.

The gains were broad. TCS rose about 5%, while Wipro, HCLTech, LTIMindtree and Mphasis each gained roughly 3%. Persistent Systems and Tech Mahindra were also higher. These are intraday figures, so check the NSE website for closing levels.

Reason 1: TCS Q2 FY27 Results Met the Market's Checklist

TCS announced its results for the quarter ended 30 September 2026 on 8 October, after market hours. Here are the main numbers from the company's release.

Source: TCS Q2 FY27 results press release, 8 October 2026.

Before the results, market commentary had pointed to three markers: constant-currency growth of at least 0.5%, an operating margin near 24%, and a strong TCV. TCS met the first two. Its TCV of US$9.6 billion was below the US$10 to 11 billion that some brokerage previews had expected, so the deal-win number was not a clean beat.

TCS CEO K. Krithivasan said the company was “pleased with the broad-based growth in all our international markets and most industry segments.” That matters because investors have worried that AI could slow demand for traditional IT services.

TCS is the sector's largest company, so its numbers often set the tone for peers that report later in October. Our earlier guide to the best IT stocks in India lists the main names.

Reason 2: IT Stocks Had Fallen Sharply in September

Part of any sharp one-day rally is a bounce from a low base. TCS shares fell 14.5% in September, from Rs 2,399 to Rs 2,050.60 on the NSE, in what reports described as a sector-wide decline. Reports linked it to US interest rates, visa fee concerns and crude oil near US$100.

The Nifty IT index told a similar story. It stood at 30,838.85 on 3 September, as covered in our post on the IT stocks rebound. By 8 October it had closed at 27,736.60, about 10% lower.

When prices have already dropped this far, even a steady set of results can bring buyers back. Lower prices also mean the same earnings now cost less to own. You can check how that works with the P/E ratio.

Reason 3: The US PERM News Looked Manageable

On 8 October, reports said the US Department of Labor had suspended the Permanent Labor Certification (PERM) filings of several large companies, including Infosys, Wipro, HCLTech, Capgemini and Cognizant, alongside Microsoft and Adobe. Media reports differ on whether TCS is on the list.

PERM is the first step in a green card application. The suspension stops new filings. Reports say existing approved H-1B visas and green cards are not cancelled.

TCS said its PERM applications had been in single digits over the past two years, and that it plans to hire 15,000 local US employees over five years. Industry body NASSCOM said the firms had already cut their H-1B hiring. Together, these points suggest the near-term revenue impact may be limited, though the longer-term effect on hiring and compliance costs is not yet clear.

The suspension is a risk to watch, not a resolved issue. Stocks rose despite it, which says more about how the market weighed it on the day than about what happens next.

What a One-Day Rally Does Not Tell You

A strong day can reverse. The June to July rally in IT stocks cooled within weeks, as the earlier post notes.

TCS's constant-currency growth of 0.5% a quarter is still slow. The investment case for the sector rests on whether growth picks up over several quarters, not on one session.

Rallies also lift stocks at different speeds. Companies with weaker results can fall even when the index rises.

What to Watch Next

• Peer results: Other large IT companies report through October. Compare their constant-currency growth and margins with TCS.

• PERM developments: Watch for official statements from the Department of Labor and company filings on the impact.

• Deal conversion: Large deals only help when they turn into revenue, so track revenue growth in coming quarters.

• Official data: Check closing index levels on NSE and company announcements on the exchanges.

Frequently Asked Questions

Why did IT stocks go up on 9 October 2026?

Three things lined up. TCS reported Q2 FY27 results on 8 October with constant-currency growth of 0.5% and a 24.0% operating margin, IT stocks had fallen sharply in September, and investors judged the US PERM suspension as limited in its near-term impact on revenue.

How much did the Nifty IT index rise on 9 October?

In morning trade the Nifty IT index reached an intraday high of 28,776.75 against a previous close of 27,736.60, a gain of roughly 3.7% at the high. Later in the morning it was up about 3.2%. Closing levels can differ, so check NSE for the final figure.

What were TCS's Q2 FY27 results?

TCS reported revenue of US$7,642 million, up 0.2% quarter on quarter and 2.4% year on year in dollar terms. Operating margin was 24.0%, net margin 19.0%, and total contract value was US$9.6 billion. The board declared a dividend of Rs 12 per share.

Does the US PERM suspension cancel existing H-1B visas?

No. Reports on the action say existing approved H-1B visas and green cards are not cancelled. The suspension blocks the named companies from filing new PERM applications, the first step towards a green card for an employee.

Is a one-day rally in IT stocks a sign of a sector turnaround?

Not on its own. One day's move reflects sentiment. A turnaround needs several quarters of faster revenue growth, steady margins and deal wins converting to revenue.

Sources

• TCS Q2 FY27 results press release, 8 October 2026

• The Week, 9 October 2026 (index levels, TCS and NASSCOM comments)

• SHRM, PERM suspensions, October 2026

Market data in this article is as of the morning of 9 October 2026 and changes through the trading day. This article is for education only and is not investment advice.