InvestorQ : Why did IT stocks like Infosys, TCS and Wipro not react very negatively to the visa ban imposed by Trump?
Debbie Mascarenhas made post

Why did IT stocks like Infosys, TCS and Wipro not react very negatively to the visa ban imposed by Trump?

Answer
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Crowny Pinto answered.
4 months ago


If you take a quick look at the stock price performance of the IT stocks on 23 June, most IT companies appeared to have taken the visa suspension news in their stride. In fact, the NSE IT index actually gained by 1.5%. Given the tight employment scene in the US, this suspension was almost on the cards and the markets were hardly surprised. At best, it could only impact the short term sentiments on the stocks.

Even if it was allowed, the travel restrictions would have ensured that moving software engineers to the US would not be possible. Most IT vendors have already shifted to the work-from-home or WFH delivery model; catering to onsite work demands from remote locations. Also, the suspension does not impact existing H-1B visa holders.

Analysts are of the view that global demand for IT services post the pandemic would, anyways, be quite low. Hence in terms of fulfilment and commitment perspective, the impact will be limited. This reduces the need for fresh H-1B visas as new projects are delayed. Top IT companies are recruiting heavily in the US as a hedge.