Nifty IT slides 7% in 4 days: key risks in 2026

What happened in the Nifty IT index

IT stocks stayed under pressure as the Nifty IT index extended losses for a fourth consecutive session. In intraday trade, the index fell 2.4%. For the current week so far, the Nifty IT index has dropped 7.3%, compared with a 3% decline in the Nifty 50. The move marked another leg of a pullback that has been visible across large-cap and mid-cap IT names.

The fall has also been steep from the recent peak. From its April month high, the Nifty IT index has plunged 15%, versus a 3.8% decline in the benchmark index over the same period. Multiple reports from the day showed the sector among the weakest performers on Dalal Street, reflecting a clear risk-off tone in the technology pack.

Stocks at multi-year and 52-week lows

Several IT stocks hit fresh multi-year lows on the NSE in intraday trade, including Tata Consultancy Services (TCS), Infosys, HCL Technologies, LTM, Tata Elxsi, Zensar Technologies, and Birla Soft. In that session, some of these counters were down up to 4% intraday.

Separate market updates also pointed to large caps hovering around 52-week lows. Infosys hit an intraday low of Rs 1,130.30, while TCS touched Rs 2,283.60, with both levels described as near their 52-week lows. The weakness was not limited to index heavyweights, with midcap IT names seeing deeper drawdowns in parts of the trading day.

Intraday snapshot: where the index and heavyweights traded

As of 11:24 am, the Nifty IT index was down nearly 3% and was trading around the 28,500 level, placing it among the worst-performing sectoral indices at that time. Among key stocks, Infosys was down 3.87% to Rs 1,131.40 and TCS fell 4.15% to Rs 2,293.70. Tech Mahindra dropped 3.64%, HCLTech slipped 3.32%, and Wipro declined 2.94%.

Another update from later in the day said the Nifty IT index dropped more than 5% to 29,960.15 as of 12:55 pm. That update also described the sectoral index as having fallen about 22% in one month. Across the same narrative, Persistent Systems was reported to have plunged about 8%, while large caps such as Tech Mahindra, Infosys, HCL Technologies, TCS, and Wipro declined between 3% and 7%.

Midcap IT takes a sharper hit

Midcap IT stocks saw deeper losses around noon in one report, falling 4% to 8% as the sector rout broadened beyond frontline names. Persistent Systems fell 7.7% to Rs 4,595, while Coforge declined 6.6% to Rs 1,203.6. L&T Technology Services slipped 5.6% to Rs 3,245.4, and Tata Elxsi fell 5.2% to Rs 4,466.

The same update noted that while the Nifty IT index was down over 5%, the losses in midcap names were deeper than in large-cap peers. This pattern is typical in risk-off phases, where liquidity and positioning can amplify moves in mid-sized counters.

Why are IT stocks falling: the drivers cited

The selloff was linked to a mix of global and sector-specific concerns. Reports cited global growth worries and broader market weakness as key immediate triggers. Investor focus also turned to geopolitical tensions, with references to West Asia tensions, a fragile US-Iran ceasefire, and surging crude oil prices contributing to a broader risk-off mood.

At the sector level, multiple updates highlighted anxiety about artificial intelligence-led disruption. The concern is that rapid progress in AI tools could alter the traditional IT services model, affecting demand patterns, pricing, and competitiveness for services that were historically people-intensive.

AI announcements that added to volatility

One trigger cited during the week was OpenAI’s announcement of “OpenAI Deployment Company” (ODC), described as a new enterprise-focused business backed by over $1 billion in initial investment to help organisations build and deploy AI systems at scale. The announcement was followed by heavy selling pressure in Indian IT stocks, according to the report.

Another catalyst mentioned was remarks from AI startup Anthropic, including commentary that its Claude Code tool could be used to modernise a legacy programming language that runs on IBM systems. That narrative rekindled concerns about AI-led disruption, coinciding with a broader global tech selloff.

Earlier 2026 context: repeated AI-led shocks to sentiment

The selling pressure described in the latest move follows prior bouts of AI-driven volatility. On February 18, Indian IT stocks fell after Anthropic launched Claude Sonnet 4.6, with the Nifty IT index down nearly 2.5% to 32,265.20 around 10:05 am. That update also noted the IT index had dropped 8.2% in the prior week, described as its worst weekly performance in 11 months.

The same February update included pricing detail for Claude Sonnet 4.6 at $1 and $15 per million tokens, which became part of market conversations around accelerating capability at lower unit costs. Across these episodes, the recurring theme has been uncertainty over how quickly AI tools can commoditise some categories of software work.

Key numbers at a glance

Market impact and why the move matters

The divergence between the Nifty IT index and the Nifty 50 over the week, and from the April high, shows that the selling is sector-led rather than a uniform market decline. Alongside index-level weakness, multiple large caps and midcaps testing multi-year or near 52-week lows can change how investors position into the next set of cues.

Year-to-date declines add another layer to sentiment. In 2026 so far, TCS, Infosys, HCL Tech, Tech Mahindra, and Wipro were reported to be down in a range of 17% to 33%. With that backdrop, sharp intraday falls can reflect both fresh risk reduction and a reassessment of medium-term growth visibility.

Conclusion

The latest leg down in Indian IT stocks reflects a combination of global risk-off factors and renewed focus on AI-led disruption risks. The Nifty IT index has underperformed the broader market across the week and from its April high, while several stocks touched multi-year or near 52-week lows in intraday trade. Near-term attention is likely to remain on global growth cues, geopolitical developments that influence risk sentiment, and further announcements in the enterprise AI landscape that could reshape expectations for IT services demand.