Shares of information technology (IT) companies continued their northward movement on Thursday. The stocks have surged up to 9 per cent in the past one week after Accenture came out with better-than-expected financial results for the quarter ended May 2020.

In the management commentary, Accenture on Friday, June 26 said it expects a decline in IT budgets due to the weak economic growth outlook. However, spends on digital transformation will increase, offset by lesser spend on running operations. Accenture will transform run operations providing cost savings, which will be invested back into digital transformation.

Infosys, the top gainer among Nifty IT index, rallied 4.5 per cent to Rs 765 today. The stock of the IT bellwether surged 9 per cent in the past week, as compared to a 3 per cent rise in the Nifty50 index.

Tata Consultancy Services (TCS) was up 3 per cent at Rs 2,158, gaining 7 per cent in the past one week. The stock is 6 per cent away from its 52-week high level of Rs 2,296 touched on September 3, 2019.

IT services major TCS on Tuesday said its board will meet on July 9 to approve the financial results for June quarter. The board will also consider the declaration of interim dividend to equity shareholders, it added.

HCL Technologies, MphasiS, NIIT Technologies, Tech Mahindra, Wipro, and MindTree were up in the range of 2 per cent to 4 per cent. At 02:15 pm, the Nifty IT index, the largest gainer among sectoral indices, was up 3.1 per cent, against a 1.6 per cent rise in the Nifty50 index.

“Stronger-than-expected results/commentary of Accenture sets an encouraging tone for the impending earnings season for Indian IT. This time, Accenture’s Q3FY20 comprising Mar-May’20 (MAM) is the most severely disrupted due to the Covid-19 pandemic. Despite this, the impressive performance and new deal bookings epitomise the resilience and adaptability of Accenture’s business model,” Motilal Oswal Securities said in a note.

The brokerage firm sees Accenture’s results and commentary as a mere re-iteration of the adaptability and resilience of the business model. This should partly alleviate the concerns of Indian IT investors around the potential disruption to operations, business continuity and new deal wins, it said.