The IT rout on Nifty50 is no longer a short-term correction. It has turned into a prolonged phase of pressure that investors have been grappling with for nearly two years.
Every major IT heavyweight in the Nifty50 basket — except one — has delivered negative returns during this period. The sector that once led rallies is now dragging sentiment lower. And the numbers clearly show the damage.
Let’s break it down calmly and clearly.
Market Performance: IT Rout on Nifty50 Enters Second Year
The IT rout on Nifty50 is visible not just in price action, but in long-term returns.
Over the last two years:
- TCS has declined more than 32%
- Infosys has fallen 17%
- Wipro is down 13%
- HCL Technologies has slipped 10%
- Tech Mahindra, however, has gained 19%
Except for Tech Mahindra, every IT stock in the Nifty50 index has remained under persistent selling pressure.
This isn’t a temporary dip. It’s a structural downtrend that has lasted 24 months.
2025–2026 Adds More Pressure to the IT Rout on Nifty50
The selloff hasn’t eased in the current calendar period either.
- The Nifty IT index fell 12.6% in 2025
- It has declined around 11% so far in 2026
Two straight years of weakness. That has weighed on investor confidence.
The IT rout on Nifty50 intensified during recent trading sessions when Indian IT shares mirrored losses in their Wall Street peers.
Why did this happen?
Stronger-than-expected US jobs data in January reduced expectations of early interest rate cuts by the US Federal Reserve. That triggered global technology stock pressure — and Indian IT stocks followed.
Global Triggers Behind the IT Rout on Nifty50
The pressure isn’t isolated. It is global in nature.
Recent US data showed:
- 1,30,000 jobs added last month
- Unemployment rate at 4.3%
This data suggests the possibility of delayed rate cuts in the US.
When rate cuts get postponed, technology stocks tend to react sharply. Indian IT stocks, with large exposure to US markets, feel the impact almost immediately.
That ripple effect is clearly visible in the ongoing IT rout on Nifty50.
AI Concerns Add to Selling Pressure
Beyond interest rates, another layer of concern is shaping market behaviour — artificial intelligence.
There are growing worries that AI-led automation could change traditional, labour-heavy IT service models.
The concern is simple:
- AI can automate repetitive work.
- Fewer billable hours may affect revenue models.
- Headcount-driven growth could face pressure.
Whether this threat plays out fully is a debate for another time. But market sentiment is clearly reacting to it right now.
That’s another reason why the IT rout on Nifty50 has been sharper than expected.
TCS Loses Market Cap Rank Amid IT Rout on Nifty50
The pressure isn’t just in stock prices. It’s also visible in market capitalisation rankings.
On February 12:
- ICICI Bank’s market cap rose to around Rs 10.2 lakh crore
- TCS market cap slipped to Rs 9.99 lakh crore
- TCS shares fell about 5%
- ICICI Bank shares rose nearly 2%
This is significant.
For the first time since December 2020, TCS market capitalisation dropped below the Rs 10 lakh crore mark.
A day earlier:
- State Bank of India had surpassed TCS in market capitalisation.
- TCS slipped down the ranking ladder amid the broader tech selloff.
The IT rout on Nifty50 is clearly reshaping the pecking order among India’s largest companies.
Tech Mahindra Bucks the Trend
While the broader IT rout on Nifty50 remains intact, one name stands apart.
Tech Mahindra has gained 19% over the last two years.
It is the only Nifty50 IT constituent delivering positive returns in this period.
In a sector where others are struggling, this divergence is noteworthy.
Short-Term Sentiment Remains Fragile
In recent sessions, Indian IT stocks corrected sharply in line with US tech peers.
The sentiment driver is simple:
- Strong US economic data
- Reduced likelihood of early rate cuts
- AI-related disruption fears
- Continued global uncertainty
These factors have kept the IT rout on Nifty50 alive.
There is visible caution in the sector.
Company-Wise Snapshot Amid IT Rout on Nifty50
Here’s a clear summary of how Nifty50 IT majors have performed over two years:
TCS | -32% |
Infosys | -17% |
Wipro | -13% |
HCL Technologies | -10% |
Tech Mahindra | +19% |
Data like this doesn’t need interpretation. It speaks for itself.
Why the IT Rout on Nifty50 Matters?
The IT sector carries heavy weight in the Nifty index. When it struggles:
- Index recovery becomes slower.
- Institutional flows turn selective.
- Large-cap sentiment weakens.
For years, IT acted as a stability pillar. Now, during the IT rout on Nifty50, it has become a drag.
That shift changes market dynamics.
Summary: IT Rout on Nifty50 Reflects Structural Shift
The IT rout on Nifty50 is not just about short-term volatility.
It reflects:
- 2 years of negative returns in major IT stocks
- A 12.6% decline in 2025
- An 11% fall so far in 2026
- US job data signalling possible delay in Fed rate cuts
- Growing AI-related business model concerns
- Market cap reshuffling with TCS slipping below Rs 10 lakh crore
Only Tech Mahindra has shown relative resilience with a 19% two-year gain.
The story right now is clear. The sector is under pressure. The numbers confirm it. Sentiment remains cautious.
The IT rout on Nifty50 continues to shape the broader market narrative — and until global triggers stabilise, this sector will remain under close watch.
Source: Moneycontrol
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