Nifty IT Index Falls for 8th Straight Session: Why Infosys, HCLTech and Wipro Shares Are Under Pressure

The Indian IT sector remained under selling pressure on September 29, with the Nifty IT index declining around 1% and extending its losing streak to eight consecutive sessions. The index has now fallen roughly 4% during this eight-session slide, reflecting growing investor caution toward technology stocks.

Large IT companies including HCLTech, Infosys and Wipro were among the notable losers during the session. The weakness comes at a time when investors are closely watching global interest rates, crude oil prices, technology spending and upcoming quarterly earnings for signs of a recovery in IT demand.

Why Are IT Stocks Falling?

The latest decline is not being driven by one company-specific event. Instead, several global factors are influencing sentiment toward the Indian IT sector.

One important concern is the outlook for US interest rates. Markets are increasingly pricing in the possibility of another Federal Reserve rate increase in October. The probability was around 70.3% on September 29, compared with 57.6% a week earlier, according to CME FedWatch data cited by Moneycontrol.

Higher interest rates can put pressure on economic activity and corporate technology budgets. For Indian IT companies, this matters because a large portion of their business comes from overseas markets, particularly the US.

Higher Oil Prices Add Another Layer of Uncertainty

Crude oil has also become an important market concern.

Brent crude was around $107 a barrel on September 29, with geopolitical tensions involving the US and Iran contributing to the increase. Higher oil prices can raise inflationary pressure and make it more difficult for central banks to ease monetary policy.

For Indian IT companies, the impact is indirect but important. If higher energy costs contribute to persistent inflation and tighter monetary policy, businesses may become more cautious about discretionary spending, including certain technology projects.

Client Spending Remains a Key Issue

Another factor investors are watching is the lack of a clear improvement in discretionary technology spending.

Companies can delay projects such as large digital-transformation programmes when economic visibility is weak. This can affect the timing of new contracts and revenue growth for IT service providers.

Recent sector commentary has also highlighted uncertainty around technology spending, client decision-making and the broader global economic environment.

This explains why investors are paying particular attention to management commentary during the upcoming earnings season.

September-Quarter Results Could Be Important

The next major event for the sector will be the September-quarter earnings season.

TCS is scheduled to announce its results on October 8, marking the beginning of the key earnings period for the sector. Investors will be looking for information about deal wins, revenue growth, margins, hiring, client spending and management expectations for the coming quarters.

The results could therefore provide a clearer picture of whether the recent weakness represents temporary market pressure or reflects a more persistent slowdown in technology demand.

Infosys, HCLTech and Wipro Among Stocks Under Pressure

During afternoon trading on September 29, HCLTech, Infosys and Wipro were among the IT stocks facing selling pressure, with declines in the range of roughly 1%-1.7% at the time reported by Moneycontrol.

The weakness has also been visible across the broader IT basket. Recent market data showed pressure on several Nifty IT constituents, demonstrating that the selling has not been restricted to a single company.

Rising US Bond Yields Are Another Warning Signal

US Treasury yields have also moved sharply higher. The 10-year Treasury yield reached its highest level since 2007, while the 30-year yield touched its highest level since 2004, according to the latest market report.

Higher bond yields can make equities relatively less attractive and can increase pressure on valuations, particularly for companies whose future earnings are expected to grow over a long period.

This is one reason why global interest-rate movements remain important for Indian IT stocks even though the companies themselves are based in India.

AI Is Part of the Story, But Not the Whole Story

Artificial intelligence remains a major structural change for the IT industry, but the current decline should not automatically be interpreted as an AI-driven collapse in traditional IT services.

Recent sector analysis has pointed instead to a combination of macroeconomic uncertainty, delayed client decisions and weaker discretionary spending as important factors behind the pressure on Indian IT stocks.

At the same time, AI is changing how technology budgets are allocated. Investors will therefore be watching whether traditional outsourcing demand can increasingly be complemented by spending on AI, cloud, automation and other newer technology services.

What Investors Should Watch Next

The current weakness puts several factors in focus:

• US Federal Reserve policy and interest-rate expectations
• Crude oil prices and geopolitical developments
• US economic data and corporate spending
• September-quarter results of major Indian IT companies
• Management commentary on discretionary spending
• New deal wins and order pipelines
• Margins and currency movements
• The pace at which AI-related technology spending develops

The important point is that an eight-session decline by itself does not establish the future direction of the sector. The upcoming earnings season and management commentary could provide more meaningful evidence about demand conditions.

The Bigger Picture

The Nifty IT index's latest decline reflects a combination of global macroeconomic pressure, higher interest-rate expectations, elevated oil prices and uncertainty over corporate technology spending.

For investors, the key question is increasingly whether the sector can see a meaningful improvement in client spending while navigating higher global yields and changing technology priorities.

The October earnings season may therefore be particularly significant. Rather than focusing only on one day's market movement, investors may want to watch whether companies report improving demand, stronger deal activity and clearer guidance for the quarters ahead.

This article is for informational purposes only and does not constitute investment advice. Market prices can change rapidly, and individual stocks can behave differently from the broader Nifty IT index.