AI jitters crush India’s IT giants: Nifty IT tumbles as TCS, Infosys, HCLTech slide

Bengaluru, Feb 12, 2026, 14:42 (IST)

• Indian software exporters kept sliding for another week, dragging the Nifty IT index down roughly 5%.
• Fresh worries over artificial intelligence disruption, paired with a dip in global tech sentiment, were flagged by investors.
• U.S. jobs numbers have dimmed expectations for imminent Fed rate cuts, putting pressure on IT spending outlooks.

Indian IT stocks tumbled Thursday, with the Nifty IT index sinking roughly 5%. Heavyweights Tata Consultancy Services, Infosys, and HCL Technologies all moved lower.

This decline is notable—outsourcing giants rely heavily on revenue from U.S. clients. When investors start doubting global tech spending, the sector usually reacts quickly.

Traders this week faced a double whammy: fresh artificial intelligence tools promising to automate everyday software tasks, plus robust U.S. labor numbers that have taken the shine off expectations for speedy Federal Reserve rate cuts.

The Nifty IT index has slipped 11.4% in 2026, extending its 12.6% slide from 2025. Since February 4, when the most recent rout kicked off, the sector’s lost 13%, according to Reuters. 1

The index slid 3.59% to 33,834.05 in early hours, Upstox data indicated, with Coforge taking the biggest hit as Infosys, Persistent Systems and LTIMindtree also dropped into negative territory. TCS touched a 52-week low at 2,797.30 rupees on the NSE. HCL Technologies hovered near 1,499 rupees, down 3.38%. 2

Indian stocks mirrored fresh declines in big U.S. tech and software overnight, fueling more jitters over “AI-led” shakeups hitting legacy business models.

Anthropic’s Claude Cowork—pitched as automation for everything from legal to sales, marketing, and data analysis—has landed in the spotlight for investors. Backed by Amazon and Google, the tool adds a fresh layer of debate about just how many jobs still need big teams on the payroll.

Sentiment took another hit following a robust U.S. January jobs report. Analysts pointed out the data could let the Fed leave rates steady as it tracks inflation. Moneycontrol pegged the U.S. unemployment rate in that report at 4.3%.

Angel One’s Vaqarjaved Khan pointed to global tech struggles and a weaker rupee as key factors behind sliding sentiment, saying both pushed FPI (foreign portfolio investor) outflows even further. Darshan Rathod, COO at MULTYFI, called the selloff “more emotional than rational,” arguing that investors should “separate fear from facts” when deciding how AI might affect engineers. For Pranav Koomar, CEO and founder of PlusCash, the drop felt “more of a sentiment correction rather than fundamental weakness.” 3

One headache: clients might lean on AI to pressure prices or push back projects, which could dent revenue regardless of any drop in costs. Persistently high U.S. rates may also keep a lid on discretionary tech outlays.

At this point, traders are tracking if the downturn pushes Indian IT firms to overhaul their approach to selling and pricing as more work shifts to automation. What happens over the next few weeks depends on the direction of global tech and on whether firms can prove AI actually boosts productivity—without wiping out demand.