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HomeTechnology NewsIT stocks are set for the longest losing streak since May 2022
The Nifty IT index is set to end Friday with six straight weekly loss, the most-prolonged sell-off since the eight-week slide that ended nearly four years ago.
By CNBCTV18.com February 20, 2026, 9:59:23 AM IST (Published)
Infosys, Wipro, and Tech Mahindra were the top losers on the Nifty 50 in early trade on Friday, following a cut in guidance from EPAM, a $7 billion software peer listed on the New York Stock Exchange.
The cuts were deeper in the midcap IT space as the market sees the companies as increasingly vulnerable to the onslaught of artificial intelligence (AI).
Share prices as at 9:20 am on Feb 20.
The Nifty IT index is down over 2.5% this week so far, and is most likely to close with losses for the sixth straight week in a row, making this the longest losing streak in nearly four years.
The index of tech stocks in India logged eight straight weekly losses before turning around in the last week of May 2022.
The sell-off on Friday was triggered by a guidance cut in the US
Shares of Newtown, Pennsylvania-based EPAM fell over 17% after management revised 2026 growth guidance to 3% to 6%, down from an earlier projection of 4.9% in constant currency terms.
The software giant cut its growth estimates despite stronger-than-expected sales growth of 13% in the latest fourth quarter ended December 2025.
The management of EPAM blamed the loss of business from a client in Mexico, the largest customer for Neoris (a company that EPAM acquired in November 2024.
CEO and President Balazs Fejes' narrative stood in stark contrast to the growing fear of existential risks to software services posed by recent leaps in AI.
While AI can code better and faster, Fejes believes, customers will look for companies that can build software rather than buy it off the shelf.
Yet, business may be slower in the short term. "As clients are now really decided to actually embark on large AI transformation programs, that naturally drives them towards a more stringent, let's call it, slower process, which involves procurement, which is naturally going to slow down the decision-making process itself," Fejes explained.
Fejes is one of the rare voices — like Nikesh Arora, the CEO of the $121 billion cybersecurity giant, Palo Alto Networks — who believe that the market is overestimating what AI can do in the short term.
Pankaj Murarka, the CEO of the Mumbai-based Renaissance Investment Managers, which managed assets worth over ₹1,921 crore ($200 million) at the end of January, also believes the selling in Indian IT stocks is overdone.
"IT service companies have a very pivotal and central role in implementing the adoption of AI in the enterprise ecosystem... We have a fair degree of ownership in these companies, and I firmly believe that for a longer-term investor, these are very compelling valuations to buy into these companies," he told CNBC-TV18 on Friday.
