IT stocks slump 4% on concerns over H1-B visa
IT stocks fell as much as 4% on Friday amid concerns that a bill backing key changes in the H1-B Visa programme, that allows skilled workers from countries like India to fill high-tech jobs in the US, has been re-introduced in the US Congress.
Shares of Infosys lost 2.50%, TCS went down by 2.18% and Wipro dipped 2.18% on BSE.
These three stocks were the biggest laggards on the benchmark Sensex that ended 119.01 points lower at 26,759.23.
Among others, shares of Tech Mahindra slipped 3.80%, Hexaware Technologies went down by 3.73%, HCL Tech (3.55%) and Mphasis (2.20%).
The BSE IT index fell by 2.54% to end at 9,880.61.
The top four companies -- TCS, Infosys, Wipro and HCL Tech -- together lost over Rs 22,000 crore in market valuation.
"Stocks continued the week-long surge, but with third quarter (Q3) figures expected to flow in shortly, and with IT stocks bogged down by US visa restriction fears, profit-booking gained traction as the day drew to a close," said Anand James, Chief Market Strategist, Geojit BNP Paribas Financial Services.
A bill backing key changes in the H1-B visa programme has been re-introduced in the US Congress by two lawmakers who claim that it will help crack down on the work visa abuse.
The 'Protect and Grow American Jobs Act' makes important changes to the eligibility requirements for H1-B Visa exemptions was re-introduced by Republican Darrell Issa and Scott Peters both from California.
The bill, among other things, increase the minimum salary of H-1B visa to $100,000 per annum and eliminates the Masters Degree exemption.
The bill comes after a number of companies -- Disney,SoCal Edison and others -- have come under fire for abusing the H1-B Visa programme to replace American workers with foreign workers.