IT stocks turn weak

IT Stocks, more so TCS, Cyient and L&T Tech are trading in the red. While TCS and L&T Tech are down less than 1%, Cyient is currently down almost 2% and Infosys is actually trading in the positive, up less than 1%.

These are the IT companies which had celebrated big time when they received outsourcing contracts of more than $1 billion from Boeing. But the very same contracts are now at a risk as Boeing announced that it will be stopping production of its Boeing 737 Max from January.

Those in the industry say that such contracts usually have safeguard clauses to protect companies from losses arising out of such uncertainties. So they feel that in the short term there is bound to be an impact on the profitability but because they have been trusted suppliers for years, in the long term, their relationship with Boeing will not affected.