India's Nifty IT index fell 1.3%

India's Nifty IT index fell 1.3% on Monday, extending its downward trend amid ongoing concerns about artificial intelligence-driven disruption in the global technology sector. The index, which tracks the performance of India's top IT firms, has been under pressure for much of the year, with the Nifty IT Index on track to record steepest monthly drop since 2008, marking its steepest monthly drop since the 2008 global financial crisis.

The decline comes as global tech stocks face volatility, with the Nasdaq Composite falling over 2% in the previous session ahead of key U.S. inflation data. Indian IT stocks were also impacted by weak earnings reports and fading expectations of an imminent U.S. interest rate cut, which has traditionally supported demand for Indian IT services.

The Nifty IT index has lost 12.5% in 2026 so far, nearly matching its full-year decline in 2025. Analysts suggest that the sharp correction has dampened investor sentiment, with traders reacting to heavy selling in the sector amid global market uncertainty.

The index currently stands at 31,116.55, with a 1-month return of -1.93% and a 6-month return of -15.64%. The index is composed of 10 major IT firms listed on the National Stock Exchange, offering a comprehensive view of India's technology sector.

Investors remain cautious as they await further clarity on the global economic outlook and the potential impact of AI on traditional IT services.