Nifty IT Index Falls Over 1% as Global AI Stocks Stage Recovery; Mphasis, HCL Tech, Infosys Down 2-3%

Indian information Technology Stocks came under selling pressure on Monday, November 9, even as several Asian markets recovered and global artificial intelligence (AI) and semiconductor stocks staged a rebound. The Nifty IT index declined 1.22% to settle at 32,468.90, making it the worst-performing sectoral index during the trading session.

The decline was broad-based, with eight of the 10 constituents of the index closing in negative territory. Mphasis and HCL Technologies led the losses, while Infosys, Tech Mahindra and other major IT stocks also ended lower.

Concerns about the ability of Indian IT companies to convert growing AI adoption into meaningful revenue growth continued to weigh on investor sentiment. Uncertainty around client spending and delays in routine software upgrades added to the pressure on the sector.

Key Highlights

• Nifty IT fell 1.22%, or 400.75 points, to close at 32,468.90.
• Mphasis declined 2.73%, while HCL Technologies dropped 2.43%.
• Infosys lost 1.49% and Tech Mahindra fell 1.36%.
• Eight out of the 10 Nifty IT constituents closed in the red.
• AI monetisation concerns and cautious client spending weighed on Indian IT stocks despite a recovery in several Asian markets.

Nifty IT Index Performance on November 9

The Nifty IT index ended Monday’s session at 32,468.90, declining 400.75 points or 1.22% from its previous close of 32,869.65. The index opened at 32,745.75 before facing further selling pressure during the session.

It touched an intraday low of 32,151.80, highlighting the weakness across major IT stocks. The decline came despite improving sentiment in several Asian equity markets, where semiconductor and AI-related shares recovered from recent losses.

Heavyweight stocks such as Infosys, Tata Consultancy Services (TCS) and HCL Technologies contributed to the sectoral index’s weakness. The performance indicated that domestic IT stocks were facing company and sector-specific concerns even as global technology shares showed signs of recovery.

Mphasis, HCL Tech and Infosys Lead IT Stock Losses

Mphasis was the biggest loser among Nifty IT constituents, falling 2.73% to Rs 2,455 compared with its previous close of Rs 2,524. HCL Technologies followed with a decline of 2.43%, while Infosys dropped 1.49%.

Tech Mahindra shares slipped 1.36%, while Coforge declined 1.21%. Oracle Financial Services Software and TCS also ended lower, falling 0.96% and 0.94%, respectively. LTIMindtree edged down 0.14%.

In contrast, Wipro and Persistent Systems were the only two constituents of the Nifty IT index to finish in positive territory. Wipro gained 0.73%, while Persistent Systems advanced 0.30%.

Why Are Indian IT Stocks Falling?

Concerns Over AI Monetisation

One of the major concerns weighing on Indian IT stocks is whether companies can convert the growing adoption of artificial intelligence into sustainable revenue growth. Although businesses are increasingly exploring AI tools and services, investors remain focused on how quickly these investments will translate into commercial opportunities for technology service providers.

AI adoption does not automatically guarantee higher revenue for IT companies. Businesses need to develop relevant services, secure client contracts and demonstrate measurable value from their technology investments. Uncertainty over the pace of this process has created concerns about future earnings growth in the sector.

Clients Remain Cautious About Technology Spending

Another factor affecting the Indian IT Sector is cautious spending by clients. Companies in major markets may delay technology projects, reduce discretionary expenditure or postpone routine software upgrades when economic conditions remain uncertain.

Such decisions can affect the revenue growth of Indian IT service providers, which depend on corporate technology budgets and long-term outsourcing contracts. If clients continue delaying projects, companies could face pressure on their business growth and earnings expectations.

Selling Despite Recovery in Asian Technology Stocks

The decline in Indian IT shares came even as several Asian markets recorded gains on Monday. Improving sentiment was supported by lower crude oil prices and a recovery in semiconductor and AI-related stocks in Japan.

This divergence suggests that the concerns affecting Indian IT companies were not entirely aligned with the broader recovery in global technology stocks. Investors continued to assess the earnings outlook and AI-related opportunities of domestic IT service providers.

Expert View: Inflation Data and Global Sentiment in Focus

Vinod Nair, Head of Research at Geojit Investments Limited, said Indian equities traded in a range with a positive bias, while intermittent profit booking after the recent rally limited gains. Weakness in IT and metal stocks also weighed on benchmark indices.

Nair noted that improving foreign institutional investor participation and better-than-expected corporate earnings had strengthened expectations of an upgrade to the FY27 earnings outlook.

He also highlighted valuation comfort, easing geopolitical concerns, moderation in crude oil prices and expectations of a double-digit earnings recovery as factors supporting the medium-term market outlook.

According to Nair, investors are awaiting Indian and US inflation data for fresh signals on the interest rate trajectory. Crude oil prices and global risk sentiment will also remain important factors influencing markets in the near term.

Nifty IT Remains Higher on a Monthly Basis

Despite Monday’s decline, the Nifty IT index continued to show strong gains on a monthly basis. The index was still up approximately 13% during the month, supported by broadly in-line September-quarter earnings from several major IT companies.

It had also gained nearly 15% since Tata Consultancy Services announced its July-September quarter results last month. This suggests that the latest decline came after a period of substantial gains in the sector.

However, the recent rally has also made investors more attentive to earnings performance, future growth expectations and the ability of IT companies to benefit financially from AI-related opportunities.

Asian Markets Recover as Japanese AI and Semiconductor Stocks Rise

Most Asian markets closed higher on Monday as lower crude oil prices and a recovery in Japanese semiconductor and AI-related shares supported investor sentiment. Brent crude oil’s January futures contract was trading around $97 per barrel, down more than 1%.

Japan’s Nikkei 225 and Topix indices gained approximately 2% and 3%, respectively. Semiconductor companies contributed to the recovery, with Tokyo Electron shares rising nearly 3% and Advantest advancing by more than 1%.

However, not all Japanese technology-related stocks participated in the gains. SoftBank Group shares fell more than 4% following developments involving its efforts to salvage a $5.4 billion robotics deal with Switzerland-based ABB, which Chinese regulators had rejected.

South Korea’s Kospi was higher during early trading but later pared its gains, making it the weakest performer in the region. Moderate gains in Samsung Electronics and SK Hynix helped limit the decline in the index.

LG Energy Solution shares dropped almost 6%, while automobile stocks also faced pressure. Hyundai Motor and Kia declined by around 3% each. Singapore’s FTSE Straits Times Index was closed on Monday on account of Diwali.

What Should Investors Watch Next?

Investors will closely monitor the September-quarter earnings performance of IT companies, management commentary and updates on client technology spending. These factors could provide a clearer picture of demand conditions and the industry’s ability to generate revenue from AI-related services.

Inflation data from India and the United States will also be important because they could influence expectations about interest rates and global investment flows. Changes in crude oil prices and international market sentiment may add to short-term volatility.

For the Nifty IT index, the key question is whether companies can sustain earnings growth while adapting to changing technology requirements and cautious client budgets. The recent monthly gains indicate that the sector has recovered from earlier weakness, but Monday’s decline highlights the risks that continue to influence investor sentiment.

Conclusion

The Nifty IT index declined 1.22% on November 9, with Mphasis, HCL Technologies and Infosys among the major losers. The fall came even as several Asian markets recovered and Japanese AI and semiconductor stocks recorded gains.

Concerns about AI monetisation, cautious client spending and delayed technology upgrades continued to weigh on Indian IT companies. With inflation data and further earnings-related developments in focus, investors will be watching whether the sector can maintain its recent recovery while addressing concerns about future revenue growth.