Indian stock market rally has a catch: Why TCS, Infosys and HCL Tech were among the top laggards

Indian benchmark indices rose on 2 November 2026, with Nifty up 1.68% and Sensex up 1.66%, driven by Reliance Industries' 11.6% surge after reporting record quarterly profit. Energy, infrastructure, and metal stocks led gains, while IT and media stocks lagged. Crude oil prices fell, and foreign inflows supported sentiment.

The Sensex and Nifty indices rose sharply in early trade, with the Sensex gaining 764.72 points to 75,216.80. Reliance Industries led the rally, surging over 6% after reporting a record quarterly profit of Rs 29,550 crore. Declining oil prices and foreign fund inflows also contributed to the market's optimism. Other gainers included NTPC, Tata Steel, and State Bank of India, while Sun Pharma and Infosys traded lower.

Infosys (INFY) reported Q2 revenue of $5.145B, with $540M from AI, but cut FY27 growth guidance to 1–2% due to softer demand and pricing pressure. A $5.2B deal contrasts with cautious analyst views. U.S. immigration issues and a DOJ probe are ongoing. ICICI cut its target, while Motilal Oswal maintained a BUY rating.

Infosys and Cognizant report AI's impact on their businesses. Infosys notes clients demand pricing adjustments due to AI productivity, while Cognizant reports over 50% AI-assisted code and improved margins. Both companies face challenges in balancing cost savings, pricing pressure, and future productivity promises.

Infosys expanded its Pocharam campus in Hyderabad by 11 lakh sq ft, adding 10,000 seats. The facility serves global clients in sectors like banking and life sciences, focusing on AI and cloud services. According to IT Minister D Sridhar Babu, the expansion reflects confidence in Hyderabad's tech ecosystem and will create jobs. The campus has seen over Rs 3,200 crore in investments.

U.S. Secretary of State Marco Rubio stated that recent changes to U.S. work visa rules are global and not targeted at India. The U.S. Labor Department suspended six major IT outsourcing firms, including Infosys, Tata Consultancy Services, and Wipro, from the PERM program. Rubio emphasized the measures aim to protect American workers and address fraud in business-related immigration programs. India has expressed concerns, stating the measures do not support shared objectives.