Rs 1.56 lakh crore mcap wiped out! What triggered sharp fall in TCS, Wipro and other IT stocks?

Information technology stocks came under sharp selling pressure on Wednesday, with investors booking profits after a strong rally in recent sessions. Weakness in global technology shares and a decline in US-listed Indian IT stocks also weighed on sentiment.

The Nifty IT index fell 1,690.30 points, or 5.43 per cent, to 29,426.25 in intra-day trade. The decline came after a sharp recovery in the sector over the past few weeks.

Market participants said investors opted to lock in gains after the recent rally in IT stocks. The Nifty IT index had climbed to a one-month high and was up nearly 15 per cent from its May lows before Wednesday's selloff. The index had also gained around 7 per cent in the previous two trading sessions.

Weak global cues add to pressure

The sector's weakness was in line with the trend seen in global technology stocks. Shares of major US software companies declined after a recent rally driven by optimism surrounding artificial intelligence-related spending.

Cognizant and Accenture fell about 5 per cent each, while Globant declined 4.8 per cent. The weakness in these stocks affected sentiment towards Indian IT companies, which derive a significant portion of their revenue from overseas markets, particularly the United States.

Indian IT ADRs also traded lower. Wipro's ADR dropped around 8 per cent, marking its biggest single-day decline this year. Infosys ADR fell about 2.5 per cent.

Among Nifty constituents, TCS and Infosys emerged as the biggest contributors to the benchmark index's decline during the session.

Market value of IT firms erodes

The sell-off led to a sharp erosion in the market capitalisation of leading IT companies. The combined market value of 10 major IT firms declined by an estimated Rs 1.56 lakh crore during the session.

Tata Consultancy Services (TCS) recorded the biggest loss in market value. The company's market capitalisation eroded by an estimated Rs 77,853 crore as its shares fell 8.79 per cent.

Infosys witnessed an estimated market-cap erosion of Rs 20,928 crore, while HCL Technologies lost about Rs 16,231 crore in market value.

LTIMindtree saw an estimated decline of Rs 10,018 crore in market capitalisation as its shares dropped 7.77 per cent. Tech Mahindra's market value fell by about Rs 9,471 crore, while Wipro registered an estimated erosion of Rs 7,339 crore.

Persistent Systems witnessed an estimated market-cap loss of Rs 5,164 crore. Coforge lost about Rs 4,032 crore in market value, while Oracle Financial Services Software (OFSS) recorded an estimated erosion of Rs 3,017 crore.

Mphasis saw the smallest decline among the 10 companies, with its market capitalisation falling by an estimated Rs 1,779 crore.

Overall, the combined market value of TCS, Infosys, HCL Technologies, LTIMindtree, Tech Mahindra, Wipro, Persistent Systems, Coforge, OFSS and Mphasis declined by an estimated Rs 1,55,833 crore during the session.

Strong rebound from May lows

The decline comes after a strong rebound in the IT sector from its recent lows. The Nifty IT index had touched a 52-week low of 27,078 on May 14, 2026. From that level, the index rallied sharply and rose about 14.9 per cent to its previous close of 31,116.55.

The recovery was supported by buying in large-cap IT stocks and renewed optimism around artificial intelligence-related opportunities. Expectations of increased technology spending and AI adoption had boosted sentiment towards the sector in recent weeks.

Nifty IT remains above 52-week low

Despite Wednesday's sharp correction, the Nifty IT index remained about 8.7 per cent above its 52-week low.

Market participants said the latest decline reflects profit booking after a strong rally rather than any major change in the sector's fundamentals. However, weakness in global technology stocks and negative cues from US-listed IT shares added to the pressure and triggered broad-based selling across the sector.