Indian benchmark indices, the Sensex and Nifty, suffered a significant downturn in early trading today, primarily driven by a widespread sell-off in information technology (IT) stocks. The market reaction comes after global IT consulting giant Accenture revised its revenue guidance for FY26 and announced plans for higher inorganic growth investments.
IT Stocks Lead Market Decline
The 30-share BSE Sensex plummeted 745 points, settling at 76,664, while the broader Nifty 50 index fell 221 points to 23,946. The Nifty IT index, a key barometer for the technology sector, hit a three-year low of 26,634 on Friday, reflecting the sharp investor reaction.
Among the top losers on the Sensex were major IT players. Infosys shares dropped 8%, TCS fell 6.15%, Tech Mahindra declined 6%, and HCL Tech saw a 5% dip. Other significant decliners included HDFC Bank (2%) and Eternal (1.24%). Conversely, a few stocks like NTPC, Sun Pharma, Bharti Airtel, PowerGrid, RIL, and Trent managed to post gains, rising up to 1.16%.
Accenture's Outlook Triggers Sell-off
The catalyst for today's market rout in the IT sector was Accenture's updated financial outlook. The company's revised FY26 revenue guidance, coupled with its strategy for increased inorganic growth investments, spooked investors, leading to concerns about the broader health of the IT services industry.
The impact was immediately visible in overseas markets as well. Overnight, Infosys ADRs (American Depository Receipts) tumbled 9.66% to $10.57 apiece, while Wipro ADRs were down 3.63% at $2.39 apiece, foreshadowing the domestic market's reaction.
Analyst Perspectives on Market Movement
Market analysts offered their views on the current situation and potential future trends. Nandish Shah, Deputy Vice President at HDFC Securities, noted, “On the downside, immediate support is placed in the 23,800–24,000 zone for the Nifty. Any corrective dip toward this region is likely to attract buying interest, provided the index sustains above it.”
Anand James, Chief Market Strategist at Geojit Investments, commented on the Nifty's trajectory, stating, “Despite the volatility, the upswing evolved on anticipated lines. The 24,200 objective is still in play, with 24,300-24,600 also continuing to be in the radar. However, inability to float 24,100 could signal weakness, but a collapse may not unfold unless below 23,800.”
VK Vijayakumar, Chief Investment Strategist at Geojit Investments Limited, directly addressed the cause: “Guidance cuts by Accenture has triggered sell-off in Indian IT majors’ ADRs. This can cause correction in IT stocks in the domestic market too. Buying can emerge at lower levels in IT since valuations are becoming attractive.”
This sharp correction follows a period of gains, with the stock market extending its winning streak for the fifth consecutive session on Thursday. In the previous session, the Sensex had gained 254 points to close at 77,409, and the Nifty closed at 24,168.