IT stocks plunge 5.5% as AI disruption fears grip markets; Nifty sheds 147 points at 25,807

Markets closed sharply lower on Thursday, with technology stocks bearing the brunt of a massive sell-off, triggered by mounting concerns over artificial intelligence-led disruptions to traditional business models. The Nifty 50 declined 146.65 points or 0.57 per cent to close at 25,807.20, while the BSE Sensex dropped 558.72 points or 0.66 per cent to settle at 83,674.92.

The Nifty IT index emerged the day’s biggest casualty, plunging 5.5 per cent to a 10-month low. Tech Mahindra led the losers, crashing 6.40 per cent to ₹1,529.80, followed by Infosys, which tumbled 5.97 per cent to ₹1,384.10, TCS fell 5.77 per cent to ₹2,741.90, HCL Tech declined 5.20 per cent to ₹1,470.90, and Wipro dropped 4.79 per cent to ₹218.80.

“The sell-off was triggered by intensifying concerns around AI-led disruption and the potential impact on traditional outsourcing revenue models. Rapid advancements in enterprise-grade AI tools capable of automating coding, analytics, legal drafting, and business workflows are prompting investors to reassess long-term growth assumptions for labour-intensive IT services,” said Ponmudi R, CEO of Enrich Money.

Stronger-than-expected US jobs data added to the pressure by reducing the expectations of near-term Federal Reserve rate cuts, raising concerns about subdued discretionary IT spending from US clients.

The broader markets mirrored the weakness, with the Nifty Midcap 100 falling 0.47 per cent to 60,470.85 and the Nifty Smallcap 100 correcting 0.64 per cent to 17,344.10. Market breadth weakened significantly, with 2,582 stocks declining, against 1,634 advances on the BSE.

However, financial stocks provided some cushion. Bajaj Finance surged 3.31 per cent to ₹1,001.00, Shriram Finance gained 2.48 per cent to ₹1,083.00, and Eicher Motors rose 2.13 per cent to ₹7,936.50. ICICI Bank advanced 1.84 per cent to ₹1,432.00, while Bharat Electronics Ltd climbed 1.47 per cent to ₹444. The Nifty Financial Services index bucked the trend, rising 0.38 per cent to close at 28,385.20.

“Nifty failed to surpass crucial resistance of 26000 and closed below its 5 DEMA, currently placed at 25817,” said Nandish Shah, Deputy Vice-President at HDFC Securities.

Nifty Bank closed marginally lower by 0.01 per cent at 60,739.75, while the Nifty Next 50 fell 0.43 per cent to 69,916.10.

The rupee strengthened marginally by 11 paise to close at 90.59 against the US dollar. “Rupee traded slightly stronger at 90.57, gaining 0.08 paise or 0.09 per cent, as the dollar index remained flat near 96.82,” said Jateen Trivedi, VP Research Analyst at LKP Securities.

In commodities, gold prices came under pressure. “Gold traded lower by $20, or 0.40 per cent, near $5,065 on CME, after stronger-than-expected US Non-Farm Payrolls kept pressure on bullion. MCX Gold mirrored the weakness, slipping ₹650 to ₹1,58,100,” Trivedi noted.

Looking ahead, analysts expect range-bound movement with stock-specific action. “Expect markets to remain range-bound with stock-specific activity as the Q3 earnings season ends. Markets would now look at other triggers including global and domestic inflation, trade developments, and FII flows, while AI related disruptions could add to volatility,” said Siddhartha Khemka, Head of Research at Motilal Oswal Financial Services.

Published on February 12, 2026