Nifty IT Index Falls 2% as TCS and Infosys Lead Sector Decline, Investors Shift Focus to Financials

IT Stocks Snap Six-Session Gaining Streak Amid Broader Market Rebound

Information technology stocks suffered a sharp decline on Friday, reversing a six-session gaining streak as investors rotated into financials and cyclical sectors. The Nifty IT index fell 2.4 percent, emerging as the top sectoral loser despite benchmark indices trading firmly higher. The Sensex rose 812 points or 1.1 percent to 77,444, while the Nifty gained 242 points to 24,017.

The decline marked a reversal after a steady upmove in the IT pack, which had posted gains for six consecutive sessions, albeit with relatively muted performance compared to the broader market rally earlier in the week. Heavyweights led the fall on Friday, with TCS dropping nearly 3 percent, Infosys falling over 3 percent, HCL Technologies declining more than 2 percent, and Tech Mahindra slipping around 1.7 percent. Four IT stocks featured among the top losers on the Nifty.

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Mid-tier IT names also saw selling pressure, with LTIMindtree down about 2.6 percent. The weakness in IT stocks comes even as the broader market witnessed strong buying, led by financials and domestic-facing sectors. Banking and financial stocks such as ICICI Bank, Axis Bank, Bajaj Finance, and SBI rose 2-3 percent, while auto and realty indices also posted gains of around 1.5-2 percent.

Market participants attributed the latest decline to a shift in investor positioning, with capital moving away from export-oriented IT stocks towards sectors that are more directly linked to domestic growth and benefit from easing macro concerns. Earlier this week, IT stocks had seen a rebound on expectations of better-than-anticipated March quarter earnings, supported by rupee depreciation and deal momentum. However, analysts have maintained a cautious near-term outlook for the sector, with investors awaiting earnings commentary for clearer direction.

The recent underperformance follows a pattern seen over the past few sessions, where IT stocks lagged a sharp market rally driven by easing geopolitical tensions and a fall in crude oil prices, which boosted sentiment for rate-sensitive sectors.