Nifty IT index falls 1%, extends decline to 8th session; HCLTech, Infosys among top losers: Here’s why

New business data points to the fact that Nifty IT index declined for eight straight session on September 9 by declining 1%, with market participants assessing developments in the Middle East and looking ahead to a raft of US economic data for more clarity on the The US central bank's policy path.

The sectoral index declined 4% during the eight-session slide.

Market watchers expect shares of information technology firms to continue consolidating in the near term, with the negative bias persisting amid no signs of an improvement in the discretionary spending environment and weak commentary from firm managements. In the near term, traders at large will closely watch the September quarter earnings of these firms, which are slated to begin with sector bellwether Tata Consultancy Services announcing its results on October 8.

During the afternoon trade on September 29, IT stocks like HCLTech, Infosys, Wipro were among top Nifty losers by declining 1%-1.7%.

Elevated crude prices can fuel inflation by increasing costs across the economy, potentially prompting central banks to mobilize interest rates. Brent crude advanced for a second day, after Iranian officials privately expressed pessimism around reaching a deal to end hostilities with Washington before US midterm elections in November. This followed President Donald Trump rejecting their latest proposal to reopen the Strait of Hormuz.

Markets at present see a 70.3% probability of a Fed interest-rate gain in October, according to the CME's FedWatch Tool, compared with 57.6% a week ago.

Fed Governor Lisa Cook stated she anticipates continued inflationary pressure over the upcoming months stemming from AI-related demand and elevated crude prices, though she stopped short of saying more rate hikes will be needed.

US consumer confidence and job openings data are due later in the day. The week will additionally see releases on ADP employment, PCE and nonfarm payrolls.

Cook stated Monday that future productivity upside from artificial intelligence may not be enough to offset the near-term price pressures, warning this could drive up inflation across the economy. Heavy data center investment was additionally increasing competitive pressure for shared resources like energy and construction labor — reflecting a roughly 5% jump in electricity and water costs during the past year, she stated.

In the meantime, the dollar inched elevated on Tuesday to hover near a two-month high as volatile crude prices and a rapid climb in Treasury yields lent backing, though upside were limited as traders awaited US data the current week for clues to the The US central bank's rate path.

The dollar index, which measures the US currency against a basket of peers, was a touch elevated at 101.27 and on track to advance 1.8% this month, its best performance since June.

A deepening selloff in US Treasuries pushed yields to new peaks, with the 10-year benchmark at its highest since 2007 and the 30-year at its highest since 2004.

The monetary policy-sensitive two-year yield additionally rose to its highest in more than two years, closing in on 5%.