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The information provided on EL7.AI is for educational and informational purposes only and does not constitute financial advice.
Amidst a global sell-off hitting technology stocks, the Indian software sector experienced intense selling pressure reflecting concerns over the sustainability of AI valuations. The Nifty IT index lost over Rs 50,000 crore in market capitalization within the first 15 minutes of trade, led by sharp declines in majors such as TCS, Infosys, and HCLTech. According to reports, HSBC warned that accelerated M&A activity and the potential for AI-driven deflation could negatively impact the sector's long-term growth trajectory.
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Sign InThis decline coincides with weakness in the US Nasdaq Composite, which dictates global tech sentiment. In a regional context, Indian tech firms faced additional pressure following India's GDP growth data of 7.8% (per market data on June 5, 2026), prompting investors to re-evaluate positions in high-valuation sectors. Furthermore, analysts at Goldman Sachs recently noted that AI infrastructure costs might not translate into immediate returns, heightening trader caution toward stocks like INFY.
Traders should monitor key support levels for INFY, which stood at $11.76 (close June 10, 2026) after hitting a session low of $11.73. Looking ahead, upcoming US inflation data and Federal Reserve commentary will be critical catalysts, as they influence the global liquidity trends that directly impact foreign portfolio flows into emerging markets like India.