Infosys, Wipro ADRs Fall After US Green Card Programme Suspension; TCS, HCL Shares In Focus

Infosys and Wipro shares will be in focus on Friday, October 9, after their US-listed ADRs fell overnight following the US government's decision to suspend some of the world's largest IT outsourcing companies from a key employment-based green card programme.

Infosys ADRs fell nearly 3% in US trading on Thursday, while Wipro ADRs also declined after the US Department of Labor suspended Infosys, Tata Consultancy Services (TCS), Wipro, HCL Technologies, Cognizant and Capgemini from the Permanent Labor Certification, or PERM, programme. Microsoft and Adobe were also included in the action.

The suspension prevents the Labor Department from accepting new or processing pending permanent labour certification applications involving the affected companies. The move does not amount to a blanket suspension of H-1B visas, but has raised concerns over the impact on Indian IT companies that rely on the US as their largest overseas market.

The overnight fall in Infosys and Wipro ADRs now puts Infosys, Wipro, TCS and HCL Technologies shares in focus when the Indian market opens on Friday, with investors likely to assess the potential impact of tighter US scrutiny of foreign-worker hiring.

Infosys, Wipro ADRs Fall After US Action

The market reaction followed the US Labor Department's decision to suspend the IT companies from the PERM programme as the Trump administration steps up scrutiny of foreign-worker programmes.

Infosys and Wipro, which trade in the US through American Depositary Receipts, came under pressure after the announcement, while Cognizant shares also declined.

The PERM programme forms a key part of the process through which US employers sponsor eligible foreign workers for employment-based permanent residency. The Labor Department said it would neither accept new nor process pending permanent labour certification applications involving the companies covered by the suspension.

The restriction is separate from the H-1B visa programme and does not mean existing H-1B visas of employees at Infosys, TCS, Wipro or HCL Technologies have been cancelled.

Infosys, TCS, Wipro, HCL Shares In Focus

The US action puts Indian IT stocks under the spotlight ahead of Friday's trading session, particularly after the overnight weakness in Infosys and Wipro ADRs.

The development comes at a sensitive time for the sector as investors track demand from the US, client technology spending and the impact of tighter immigration rules on Indian IT companies.

Infosys, TCS, Wipro, HCL Technologies have sizeable businesses in the US, making changes to employment and immigration rules relevant for their operations in the country.

The immediate market focus on Friday will be on whether the overnight decline in Infosys and Wipro ADRs translates into selling pressure across Indian IT stocks when domestic trading begins.

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