IT stocks tumble as AI fears trigger global software rout, Nifty IT sinks over 5%

Indian IT stocks witnessed a sharp sell-off, led by heavyweights Tata Consultancy Services Ltd. and Infosys Ltd., amid a global rout in software shares triggered by concerns around Agentic AI. The downturn pushed the Nifty IT index down as much as 5.24 percent during the session.

The Nifty IT index slipped to an intraday low of 31,422.60 points, with all its 10 constituents trading in the red. The sharp fall in IT stocks weighed heavily on the broader market, dragging the benchmark Nifty 50 down by nearly one percent. Market participants said fears that rapid advancements in Agentic AI could disrupt traditional software services and pricing models triggered selling pressure across global technology stocks. Indian IT firms, which derive a significant portion of their revenues from overseas clients, bore the brunt of the risk-off sentiment.

The sell-off has also deepened losses for the IT sector over the longer term. The Nifty IT index was the worst-performing sector of the day and continues to remain the weakest so far this year, after falling 12.6 percent in 2025 and an additional 16.8 percent in 2026. The index is now on track for its worst weekly performance since March 2020, reflecting sustained investor concerns over growth visibility in the sector.