Indian IT Stocks Decline Amid Global Tech Selloff

Global Selloff in Technology and AI-Linked Shares Hits Indian IT Stocks

The Nifty IT index fell for a fourth consecutive session on Monday, triggered by a global selloff in technology and AI-linked shares, leading to fresh profit-booking across the sector. The Nifty IT index dropped 1.8 percent to 28,500 in morning trade, taking its cumulative decline to 8.4 percent over four sessions.

This correction comes amid a broader retreat from technology stocks globally after investors rushed to lock in gains in some of the market's biggest AI winners. The Nifty IT index emerged as one of the worst-performing sectoral indices on Monday, even as the benchmark Nifty 50 fell 1 percent.

Among frontline technology stocks, Wipro was the biggest casualty, plunging 5.5 percent to Rs 187.4 and emerging as the top loser on the Nifty 50 index. Other major players in the sector, including TCS, Infosys, HCL Technologies, and Tech Mahindra, also traded lower, with TCS falling 1.9 percent to Rs 2,156.7 and Infosys declining 1.3 percent.

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The weakness in Indian IT stocks mirrored a sharp selloff across global technology markets. Wall Street suffered a steep decline on Friday, with the Nasdaq falling 4.2 percent in its biggest one-day drop since April 2025. The Philadelphia Semiconductor Index recorded its worst single-day decline since March 2020, wiping out more than $1 trillion in market value.

Asian technology-heavy markets extended the selloff on Monday, with South Korea's Kospi tumbling 5 percent and Japan's Nikkei dropping nearly 4 percent. Taiwan's benchmark index fell almost 4 percent as investors exited chipmakers and other AI-linked stocks that had led global markets higher in recent months.

Two factors appear to have triggered the reversal. First, investors were disappointed by the outlook from semiconductor company Broadcom, prompting concerns that expectations surrounding AI-related spending may have become too optimistic. Second, a stronger-than-expected US jobs report raised fears that the Federal Reserve could maintain a hawkish stance for longer, reducing the appeal of richly valued technology stocks.

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The selloff marks a sharp shift in sentiment after investors had recently rotated back into software stocks on hopes that AI was creating fresh demand opportunities rather than disrupting existing business models. Strong results and guidance from software companies such as Snowflake, ServiceNow, and SAP had helped fuel a rebound in Indian IT shares over the past two weeks.