Sensex settles 550 pts lower, Nifty ends near 25,800: IT sell-off among key factors behind market decline

Stock market today news: Sensex, Nifty see profit booking in trade. 

• Sensex and Nifty fell, dragged by IT shares amid weak US market cues.
• Nifty IT index fell 4%, with Tech Mahindra, Infosys, Wipro among top losers.
• Oil prices rose, adding concerns for India due to inflation and trade deficit.

Did our AI summary help?

The benchmark equity indices Sensex and Nifty declined on Thursday, dragged down by heavy selling in IT shares amid weak cues from US markets.

The Sensex settled 558.72 points or 0.66 percent lower at 83,674.92, while the broader Nifty settled at 25,807.20, down 146.65 points or 0.57 percent.

Tech Mahindra, Infosys and Wipro were among the major laggards in the Nifty50 pack, declining up to 5 percent, while Bajaj Finance and State Bank of India rose up to 2 percent. Market breadth was negative as about 1468 shares advanced, 2011 shares declined and 175 shares unchanged.

Key factors behind market decline

1) Selling in IT shares: Shares of Indian IT firms fell sharply, tracking losses in their Wall Street peers after better-than-expected US jobs data for January lowered expectations of an early rate cut by the US Federal Reserve. Concerns over artificial intelligence-led disruptions also weighed on sentiment.

The Nifty IT index declined more than 4 percent, emerging as the top sectoral loser.

After losing 12.6 percent in 2025, the index has declined about 11 percent so far in 2026 amid concerns that AI-driven changes could impact earnings of software services companies.

"It’s a mix of knee-jerk reaction and concerns over real threat to IT," Vinit Bolinjkar, Head of Research at Ventura Securities told Reuters. "AI automation targets labour-heavy models at top Indian IT firms, slashing billable hours and headcount," he added.

VK Vijayakumar, Chief Investment Strategist at Geojit Investments, said tech stocks are unlikely to recover soon following sharp declines in the ADRs of leading Indian IT companies in the US.

"The latest US jobs data indicating addition of 1,30,000 jobs last month and unemployment falling to 4.3 percent points to the possibility of no rate cuts by the Fed in the near term. In India, too, it appears that the rate-cutting cycle is over since growth is good and inflation is expected to inch back to the RBI’s long-term target by the end of FY27," Vijayakumar said.

2) Crude rises: Oil prices edged higher amid concerns over escalating tensions between the US and Iran. Brent crude, the global oil benchmark, rose 0.46 percent to USD 69.72 per barrel. Higher crude prices are seen as negative for India, which is a major importer of oil, as they can widen the trade deficit and add to inflationary pressures.

Stock Market LIVE Updates

3) Weak global cues: In Asia, Hong Kong’s Hang Seng index was trading in the red. US markets had closed lower on Wednesday.

Technical outlook

The Nifty continues to hold its uptrend, trading above key moving averages. Immediate resistance is seen near the 26,000 level. A move above this could push the index towards its record high of 26,373. On the downside, the 25,700-25,780 zone is expected to offer support, said Devarsh Vakil, Head of Prime Research, HDFC Securities.

Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.