IT stocks are trading sharply lower on Wednesday, with the Nifty IT index down 3.38% in ongoing trade, extending losses for a second consecutive session. Infosys, Coforge, Mphasis and HCL Technologies are among the major laggards, while selling pressure is also weighing on several mid-cap IT stocks. The Nifty 50 is trading in the red as broader market sentiment remains weak.
The sell-off follows Infosys' decision to lower its FY27 revenue growth guidance, with looming concerns over demand and pricing pressure in the IT sector. Investors are also weighing the potential impact of AI on traditional IT services, alongside a stronger rupee, global technology earnings and uncertainty over the US Federal Reserve's upcoming policy decision.
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Infosys, Coforge, Newgen Software Lead Losses
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Infosys shares declined 4.54% at 10:13 a.m., while Coforge fell 2.78%. Newgen Software Technologies dropped 3.30%, HCL Technologies declined 2.73%, and Tech Mahindra slipped 3.2%.
Tata Consultancy Services fell 3.04%, followed by Birlasoft, which declined 2.76%, and KPIT Technologies, down 2.63%. Latent View Analytics lost 2.17%, while Persistent Systems fell 2.04%.
Sonata Software, Wipro, Tata Elxsi Also Decline
Sonata Software declined 1.86%, Zensar Technologies dropped 1.79%, and Happiest Minds Technologies fell 1.53%. Wipro slipped 1.45%, while Tata Elxsi declined 1.18%.
Fractal Analytics was the only stock that was marginally trading higher, gaining 0.49%, but later declined and is currently trading 0.2% down from its previous close.
Infosys Guidance Cut
The sell-off follows Infosys' decision to lower its FY27 revenue growth guidance to 1%-2% in constant currency terms, from the earlier forecast of 1.5%-3%, fuelling concerns over demand and pricing pressure across the IT services sector.
Investors are also assessing how artificial intelligence could reshape traditional IT services. Strong earnings from South Korean chipmaker SK Hynix point to continued demand for AI infrastructure, but Indian IT companies face questions over whether AI-related services revenue can offset disruption to their existing businesses.
Rupee Strength Weigh On IT Stocks
A stronger rupee could add to the pressure on IT exporters by reducing the rupee value of their dollar earnings. Investors are also awaiting the US Federal Reserve's policy decision for clues on the interest rate outlook and its potential impact on global technology spending.
Also Read: Infosys Stumbles As Much As 4% Post Q2: Is The Weak-Rupee IT Bubble Bursting?
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