HCL’s AI Rally Gave Sensex 1,109 Points, Briefly

The Sensex closed 1,109.10 points higher on October 13 after HCLTech’s AI-heavy quarter turned a 305-point open into the best session in four months. The Nifty 50 settled at 22,721.95, up 358.60 points, or 1.60 per cent, with the Nifty IT index up 5.22 per cent.

Finance Minister Nirmala Sitharaman’s lunchtime tax comments added a second bid. She promised no change. By October 19, Brent near $110, October foreign selling and private-bank earnings had taken 876.37 points off the Sensex, and HDFC Bank, named as a leader of that Tuesday bounce, was among the names giving it back.

The 305-Point Open Became a 1,109-Point Close

Early on October 13 the 30-share BSE Sensex was up 305 points at 72,224.15, and the Nifty was up 93.40 points at 22,458.50, a modest repair after Monday’s drop of 547.65 points, or 0.76 per cent, to 71,924.68. By the close the Sensex sat at 73,033.78, a gain of 1.54 per cent, after an intraday high of 73,045.67. The Nifty’s close matched its session high.

That was the strongest Sensex day in four months and the Nifty’s strongest rebound in more than two. Broader gauges lagged the benchmarks: the Nifty Midcap 100 rose 1.06 per cent and the Nifty Smallcap 100 inched up 0.11 per cent. South Korea’s Kospi fell 5.46 per cent the same day, so the Indian close was not a copy of Asia.

THE SESSION VERSUS WHAT FOLLOWED

The week through October 16 still showed a 2.8 per cent Nifty gain and a 3.1 per cent Sensex gain, with Nifty IT up 11.7 per cent. Monday, October 19, then erased a large slice of that extra advance.

HCL’s $219 Million AI Line Did the Index Work

HCLTech reported results on October 12. Consolidated net income for the July-September quarter was ₹5,132 crore, up 21.2 per cent from a year earlier and 11.0 per cent from the prior quarter, on revenue of ₹35,620 crore. Dollar revenue was $3,724 million. Constant-currency growth was 2.3 per cent quarter on quarter and 2.6 per cent year on year, a miss against some street estimates near 2.5 per cent on the sequential print, while the margin beat landed first.

EBIT margin rose 131 basis points sequentially to 18.2 per cent, 71 basis points higher than a year earlier, after 84 basis points of restructuring cost. Diluted earnings per share were ₹70.22. The board declared a ₹12 dividend. On the company’s advanced AI revenue of $219 million, growth was 28.4 per cent sequentially and 78.0 per cent year on year in constant currency, an annualised run rate of $876 million, or about 5.88 per cent of quarterly dollar revenue.

HCLTECH Q2 FY27, COMPANY FIGURES

• New bookings: TCV of $3,258 million, up 27 per cent year on year, with first-half bookings at a record.
• AI mix: Agentic AI revenue crossed $100 million; management tied about 32 basis points of the sequential margin gain to advanced AI, with about 23 basis points from currency.
• FY27 guidance: Constant-currency revenue growth 2.5 to 4.0 per cent, the floor lifted from 1 per cent, services 3.0 to 4.0 per cent, EBIT 17.5 to 18.5 per cent.
• Headcount: 230,339 people after a net add of 6,450 in the quarter.

Chief executive C Vijayakumar put the bookings and the AI line in one breath on the investor page, then warned on the October 12 press conference that the other side of the same technology is still young.

I would say we are in the early phases of deflation. It’s not that the deflation has really played out.

C Vijayakumar, CEO and Managing Director, HCLTech Q2 FY27 earnings press conference

He said services added more than $100 million of incremental revenue in the quarter, about $50 million from advanced AI and about $50 million from core work after AI-related deflation. The quarter included a $1.14 billion Mercedes-Benz contract. HCLTech also announced a global premier partnership with Anthropic the same day. Software remained the soft patch, down 11.2 per cent year on year in constant currency.

Index buyers treated that print as a sector bid. The company’s own new deal wins of $3,258 million sat beside a guidance raise that only lifted the floor. Hiring chatter around the results split the graduate market into a standard band and a much richer AI-skills band, which is a labour story the Sensex cannot underwrite for a full week.

WHERE EXPERTS DISAGREE

• Kotak Securities: Kept a Reduce rating and raised its target to ₹1,220, calling the margin a surprise and products a miss.
• Citi: Kept a Sell rating and raised its target only to ₹1,050, arguing services guidance still implied a slow second half.

Those notes did not stop HCLTech from leading the Nifty 50 on October 13. They did mark how little of the 8 per cent jump was a clean, uncontested re-rating.

Sitharaman Heard the Tax Debate and Promised Nothing

Afternoon buying thickened after Sitharaman spoke at the Bloomberg New Economy Forum in New Delhi. Long-term capital gains on holdings over 12 months currently sit at 12.5 per cent, with an exemption of ₹1.25 lakh a year. In the 2026 Budget, securities transaction tax on equity futures rose to 0.05 per cent from 0.02 per cent, and the tax on options premium rose to 0.15 per cent from 0.1 per cent. Foreign and domestic investors have been asking for one of those layers to give way. She did not grant it.

We are very close to the budget and the preparation for the budget has started and it may not be the best time for me to say what I will or what I will not consider. So, I’ll tread cautiously on that.

Nirmala Sitharaman, Finance Minister, Bloomberg New Economy Forum, New Delhi, October 13

She called the LTCG and STT debate healthy and said she would be keen to hear views, including from investors outside India. She also restated that the 2024 alignment across asset classes was meant to stop investors shopping tax rates, not to raise the levy. Exchange operator and depository stocks caught a bid after the remarks. The Nifty, which had struggled to hold 22,600 earlier in the session, then cleared 22,700. A debate with no decision is a thin floor under a 1,109-point close.

What the Tape Paid IT and Charged the Laggards

HCLTech jumped 8.28 per cent, the top Sensex gainer, after opening-session estimates had it nearer 5 per cent. Tata Consultancy Services rose 6.59 per cent, Tech Mahindra 4.90 per cent and Infosys 4.44 per cent. Nifty IT added 1,480.50 points to 29,830.10, its strongest day since May 2025. Hindustan Unilever, Titan, Bajaj Finserv, State Bank of India, HDFC Bank, Mahindra & Mahindra and ICICI Bank also helped the 30-share index. Energy and pharma indices finished lower.

THE IT PACK ON OCTOBER 13

• HCLTech: +8.28 per cent after the AI-margin quarter.
• TCS: +6.59 per cent, extending an earlier AI-revenue bid in its own print.
• Tech Mahindra: +4.90 per cent.
• Infosys: +4.44 per cent.
• Nifty IT: +5.22 per cent, with all 10 constituents green in midday trade.

Motilal Oswal’s market desk flagged that turn while the session was still running.

IT stocks were struggling.⁰Now, all 10 are green.
Nifty IT surged over 3% today, with HCLTech and TCS jumping more than 5%.
But what's suddenly bringing investors back to Indian IT? 👇

— Motilal Oswal Financial Services Ltd (@MotilalOswalLtd) October 13, 2026

Kotak Mahindra Bank, Eternal and Maruti Suzuki were the listed laggards among heavyweights. Vinod Nair, head of research at Geojit Investments, tied the advance to stronger technology earnings, rupee stability and easier bond yields that brought financials into the bid. HDFC Bank was in that financials bucket, not the engine. Anup Bagchi becomes managing director and chief executive on October 27, which had been a succession overlay, not a results overlay. The results arrived over the following weekend.

October Still Took ₹49,457 Crore From Foreign Accounts

Exchange data showed foreign institutional investors sold equities worth ₹1,708.48 crore on October 12, the session the bounce was meant to repair. Central Depository Services Ltd’s custodian series then recorded a small equity buy on the rebound day itself, October’s daily FPI equity trend showing a stock-exchange net of ₹545.38 crore on October 13. One green FPI print does not rewrite the month.

As of October 19, CDSL’s calendar compilation put October equity net at ₹49,457 crore of selling. That follows ₹35,861 crore of equity outflows in September, after inflows of ₹20,200 crore in July and ₹29,631 crore in August. Foreign equity outflows so far in 2026 total ₹3,09,760 crore on that series, already larger than the ₹1.66 lakh crore withdrawn in all of 2025.

FLOWS AROUND THE REBOUND

1. October 12: Sensex falls 547.65 points; exchange FIIs sell ₹1,708.48 crore.
2. October 13: Sensex rises 1,109.10 points; CDSL shows a ₹545.38 crore equity exchange buy.
3. October 16: Nifty closes 23,146.15; foreign accounts turn marginal buyers for a session; Brent tags $110.
4. October 19: Sensex falls 876.37 points; FIIs sell ₹1,148.64 crore and domestic institutions buy ₹3,201.19 crore.

Dheeraj Gaur, chief investment strategy officer at Choice Wealth, pointed to high US yields, a firm dollar and expensive crude, and said an AI-led bid in North Asia was also pulling foreign cash away from Indian equities. V K Vijayakumar, chief investment strategist at Geojit Investments, said a dip in the US 10-year yield from above 5.3 per cent to 5.08 per cent, plus a firmer rupee, helped that one-day FPI turn. He still described it as tactical. Sectorally, foreign accounts kept selling financials and oil-linked names and stayed buyers in consumer services.

Oil at $110 and Monday’s 876-Point Giveback

Brent, the global benchmark, was quoted 1.08 per cent lower at $105.5 a barrel in October 13 morning trade, a dip that helped the open. It did not last. Brent settled at $109.86 on October 16 after tagging $110, the first time there since May 20, as attacks around the Strait of Hormuz, Houthi strikes toward Saudi targets and fresh Russia-Ukraine hits on energy kit kept a war premium in the barrel. Dated physical grades and paper futures did not always move together, which is another way of saying the complex was jumpy, not healed.

That is the same oil and yields already hitting the Nifty in earlier sessions, when the index lost the 24,000 handle. High crude feeds India’s import bill, the inflation print and the current account, and it keeps foreign accounts cautious even when one IT name prints a margin beat. Pabitro Mukherjee at Bajaj Broking said the Friday FPI dip in selling looked like stabilising sentiment, with crude still the risk to any recovery.

HDFC Bank then reported a September-quarter profit of ₹19,510 crore, up 4.7 per cent year on year, including treasury gains, and net interest income of ₹34,620 crore, up 9.7 per cent. The stock fell more than 2 per cent on October 19. Axis Bank dropped 3.85 per cent the same day even after consolidated net profit of ₹7,704.67 crore, up 39.4 per cent. Infosys, Bajaj Finance and Trent joined the Sensex laggards. PSU banks rose. The private-bank sleeve that had been listed among October 13’s movers was the sleeve that cracked first once the numbers were on the table.

The Sensex fell 876.37 points, or 1.17 per cent, to 73,852.90 on October 19, after a low of 73,708.54. The Nifty fell 257.20 points, or 1.11 per cent, to 22,888.95. Domestic institutions absorbed the foreign supply that day and still could not hold the prior close. HCLTech’s AI line remains a real earnings fact. It was also asked, for one week, to do work that cheap oil and foreign cash used to do, and Monday showed the limit of that substitution.

On October 19 the Sensex settled at 73,852.90, still 819 points above the October 13 close and 876.37 points below the pre-weekend mark. Brent had already printed $109.86 three sessions earlier.

Disclaimer: This article is news reporting and analysis of completed market sessions, company filings and public remarks, and it is for information only. It is not investment advice, a recommendation to buy or sell any share, index, derivative or commodity, or a forecast of returns. Readers should consult a SEBI-registered investment adviser or a qualified financial planner before acting on any market move described here. Figures for index levels, FPI flows, crude prices and earnings reflect the cited company statements and depository data as of the dates named and will change in later sessions.