Rs 40,000 crore gone in minutes! Why Infosys shares crashed 9% to hit a new 52-week low

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The sharp reaction was hardly surprising. Infosys ADRs had tumbled 10% overnight in the US, setting the stage for a steep correction in domestic markets.

Accenture’s softer outlook reinforced a growing concern among investors that enterprises continue to remain cautious on discretionary spending related to IT consulting and digital transformation projects, even as investments in artificial intelligence and cybersecurity remain intact.

The development carries significant implications for Indian IT companies, which derive a substantial portion of their revenues from North America and frequently compete with Accenture for large digital transformation mandates.

Infosys, for its part, has been aggressively expanding its artificial intelligence capabilities to offset pricing pressure in its traditional services business. The company has deepened investments in AI engineering, data and cloud through platforms such as Topaz and Cobalt, while also strengthening partnerships with OpenAI, Microsoft and Nvidia.
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Management has previously said that the deployment of AI tools, including GitHub Copilot across more than 30,000 developers, is helping generate new AI-led opportunities, while cushioning the impact of productivity-led pricing pressure.

Also read: IT Stocks: TCS, Infosys, Wipro, other IT stocks crash up to 8% as Accenture lowers FY26 guidance

US Fed delivers blow

Adding to the pressure was the latest policy outcome from the US Federal Reserve, which struck a hawkish tone and fuelled expectations of a rate hike later this year, raising concerns over a potential slowdown in discretionary spending.

Although the Fed kept rates unchanged, market expectations shifted sharply. According to CME Group’s FedWatch tool, the probability that rates would remain unchanged by the end of the year dropped to 15.7% from 40% on Tuesday. Traders now see nearly a 38% chance of a 25 basis-point rate hike by December, while the probability of a 50 basis-point hike stands at nearly 33%.

The implications are particularly important for Indian IT firms, which generate a large share of their business from North America. Higher borrowing costs or persistent inflation in the US could curb discretionary spending by enterprises, potentially affecting demand for technology services.

The sector has already endured a volatile year. Earlier in 2026, rapid advances in artificial intelligence sparked concerns about potential disruption to India’s IT services model. Sentiment was further dented by the escalating conflict in the Middle East, which weighed on broader markets and overshadowed the temporary support provided by a weaker rupee.

Read more: RIL AGM strategy: How to trade Reliance shares amid big-bang announcements by Mukesh Ambani?

For the third quarter, Accenture posted earnings per share of $3.80, compared with $3.49 in the same period last year, surpassing analyst expectations. Revenue increased 5.6% year-on-year to $18.7 billion, though it came in slightly below estimates of $18.76 billion.

Total bookings fell 1.9% to $19.32 billion during the quarter. A 15% decline in managed services bookings weighed on the overall figure, although this was partly offset by a 13% rise in consulting bookings.

Accenture also raised its full-year adjusted earnings per share forecast to $13.78-$13.90. The company left its operating cash flow and free cash flow guidance unchanged and continues to expect annual free cash flow in the range of $10.8 billion to $11.5 billion.

The latest selloff adds to an already painful year for investors. Infosys shares have tumbled 36% since the start of 2026, while the Nifty IT index has plunged 29% on a year-to-date basis.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)

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