IT carnage wipes out ₹3 lakh cr from index; Sensex, Nifty slide as global jitters deepen - Key factors

Indian equities ended the week deep in the red, pressured by an intense sell-off in information technology stocks that wiped out nearly ₹3 lakh crore in market capitalisation from the index. The Sensex and the Nifty each declined about 1% for the week, while the Nifty IT index tumbled 8%—its steepest weekly fall in a year. Five of the six biggest Nifty losers were IT majors, including Infosys, TCS, HCLTech, Wipro and Tech Mahindra.

In contrast, defence and PSU bank stocks showed resilience, gaining close to 4% each.

Eicher Motors, SBI, Shriram Finance, Apollo Hospitals and Bajaj Finance emerged as the top Nifty gainers. In the broader market, Coforge, KPIT Technologies, OFSS, Oil India and LTIMindtree were among the key laggards, whereas Bharat Forge, Kalyan Jewellers, Zee Entertainment, Poonawalla Fincorp and Astral posted strong advances.

Markets close at day’s low

On Friday, benchmarks extended losses for a second consecutive session and settled at the day’s low. The Sensex fell 1,048 points to 82,627 and the Nifty declined 336 points to 25,471, slipping below the crucial 25,500 mark. Market breadth remained weak, with the advance–decline ratio at 1:4. All sectoral indices ended in negative territory, led by metals and capital goods. Persistent Systems was among the few IT stocks to buck the trend and close higher.

Key triggers behind the sell-off

1) Heavy selling in IT stocks

The Nifty IT index dropped about 5% on Friday, extending its losing streak to a third session after a 5.5% fall in the previous trade. The index has now plunged 11.4% this week and is down 16.6% so far in 2026—already exceeding last year’s full-year decline of 12.6%. Frontline names such as Infosys, TCS, HCLTech and Tech Mahindra

led the fall amid rising concerns that artificial intelligence could disrupt the sector’s labour-intensive business model.

2) Weak global cues and spike in volatility

Risk aversion intensified after a sharp sell-off in US technology stocks. The Nasdaq fell more than 2%, while the S&P 500 and Dow Jones dropped over 1%, as stronger-than-expected US jobs data dampened hopes of an early Federal Reserve rate cut ahead of key inflation numbers. The India VIX surged more than 15% to 13.5, signalling heightened uncertainty and prompting investors to cut exposure to equities.

3) Rupee weakens against the dollar

The rupee settled at 90.64 against the US dollar, compared with Thursday’s close of 90.59. It had opened at 90.69, down 8 paise, as a firm greenback and weak domestic equities weighed on the currency. The dollar strengthened on reports that Russia may consider returning to the dollar-based settlement system as part of a possible economic arrangement with the US.

4) Asian markets track global sell-off

Most Asia-Pacific markets ended lower amid the global technology rout and renewed fears of AI-led disruption. Japan’s Nikkei 225 and Topix declined 1.2–1.6% after hitting record highs in the previous session, with IT stocks such as Trend Micro and NS Solutions falling sharply.

South Korea’s Kospi slipped 0.3%, while Singapore’s Straits Times index dropped nearly 2% and Australia’s ASX 200 fell over 1%, led by healthcare stocks. Taiwan’s markets remained shut for the Lunar New Year holiday.