TCS, Infosys and other IT stocks fall up to 6% amid fears of trade war, slowing US economy

Shares of Indian IT companies fell sharply on Friday as concerns over a slowing U.S. economy and rising inflation expectations, fueled by Trump’s tariffs, weighed on sentiment. Data showing a higher-than-expected rise in U.S. weekly jobless claims added to fears of economic weakness.

The Nifty IT index dropped over 4%, with Tech Mahindra leading the decline, falling nearly 6%. Mphasis, Persistent Systems, Wipro, LTIMindtree, and Infosys slipped 4-5%, while TCS, HCL Tech, and Coforge lost 3-4%.

The U.S. Labor Department reported an unexpected jump in initial jobless claims, rising by 22,000 to a seasonally adjusted 242,000 for the week ended February 22, the largest increase since October. The rise was attributed to snowstorms across the country and the Presidents’ Day holiday, though further layoffs could emerge in the coming weeks.


Adding to the pressure, most Asian markets traded lower, with the MSCI Asia ex-Japan index down 1.21%, tracking Wall Street losses. A steep decline in Nvidia’s shares after its earnings report triggered a broader sell-off in AI-driven and mega-cap tech stocks, dragging down the IT sector.

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The broader Indian market also took a hit. The BSE Sensex plunged 1,000 points, or 1.34%, to 73,602, while the Nifty50 fell to 22,270 around 10 a.m. The market capitalisation of all listed companies on the BSE dropped by Rs 7.16 lakh crore to Rs 385.94 lakh crore.

"Stock markets dislike uncertainty, and uncertainty has been on the rise ever since Trump was elected US president. The series of tariff announcements by Trump has been impacting markets, and the latest announcement of an additional 10% tariff on China confirms the market view that Trump will use the initial months of his presidency to threaten countries with tariffs and then negotiate a settlement favorable to the US," said Dr. V K Vijayakumar, Chief Investment Strategist at Geojit Financial Services.

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(With inputs from agencies)

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