At the time, when the market was gearing up for a significant consumption boost due to the implementation of Goods and Services Tax 2.0, the 20-fold hike in the H1-B fees hike saw information technology (IT) stocks drag down the benchmark indices by around 0.5% each.
The Nifty IT Index plunged 2.95% — its sharpest fall since April 4 — and was the top sectoral loser on the NSE. During intraday trade, the index was down nearly 4%.
The top 10 IT companies collectively lost ₹83,547 crore in market capitalisation in a single session, led by TCS (down ₹33,901 crore), Infosys (down ₹16,327 crore), and LTIMindtree (down ₹7,514 crore).
Overall, the Sensex fell 466.26 points or 0.56% to close at 82,159.97, while the Nifty declined 124.70 points or 0.49% to end at 25,202.35. Underperforming the benchmarks, the BSE Midcap and BSE Smallcap indices declined 0.78% and 0.71%, respectively.
IT sector bears the brunt
“The sharp sell-off in IT stocks followed the US administration’s decision to impose a steep hike in H-1B visa fees, which raises fresh concerns for the sector,” said Vikram Kasat, Head – Advisory, PL Capital.
He added that while the $100,000 visa fee implies a median 40 bps impact on FY27E margins across our coverage, the effect will be marginal for most firms as H-1B dependency has already reduced sharply. LTIM may face a larger 130 bps hit given its higher exposure.
In percentage terms, Mphasis, LTIMindtree, Coforge, and Persistent Systems were the top losers, falling over 4% each.
Industry leader TCS dropped 2.96% to ₹3,075.50, while Infosys declined 2.55% to ₹1,500.90. Tech Mahindra fell 3%, and Wipro and HCL Tech were down 2.11% and 1.73%, respectively. Oracle Financial Services was the lone gainer in the Nifty IT Index, rising 0.47%.
Market sentiment and volatility spike
“The market extended its weakness for a second consecutive session, with the Nifty briefly slipping below the 25,300 mark. However, a late recovery helped it close just above 25,200,” said Nilesh Jain, Head – Technical and Derivatives Research, Centrum Broking. “The 25,000 level remains a crucial psychological support, and as long as the Nifty sustains above it, a buy-on-dips strategy remains appropriate,” he added.
Besides IT, TECK, healthcare, capital goods, industrials, and telecom were among the top sectoral losers, falling up to 2.09%. In contrast, utilities, power, and metals were the top sectoral gainers, rising up to 2.56%.
Foreign portfolio investors sold shares worth Rs 2,910.09 crore while domestic institutional investors have purchased shares worth Rs 2,582.63 crore, as per provisional data by the BSE.
Market breadth was negative, with 2,511 losers against 1,775 gainers on the BSE.
Investor wealth eroded by ₹1.24 lakh crore.
The NSE India VIX Index jumped 5.91% to 10.56, indicating a rise in market volatility.