Nifty Faces Ninth Weekly Decline; TCS and Infosys Lead Friday IT Sector Recovery

• Nifty heads toward ninth consecutive weekly decline amid FII selling and elevated crude
• TCS and Infosys led a Friday IT sector bounce on currency tailwinds
• FII selling of $23.5B in September continues to weigh on Indian equity sentiment

India’s Nifty 50 index was tracking toward its ninth consecutive weekly decline as of Friday’s close, an unprecedented streak that reflects the severity of the triple headwind facing Indian equities: sustained FII outflows totalling $23.49 billion in September, crude oil prices above $104/barrel inflating the current account deficit, and rising US bond yields reducing the relative attractiveness of Indian risk assets. Business Today’s commentary noted that domestic institutional investors have been absorbing FII selling, but the mismatch in volume has kept index levels under pressure.

TCS and Infosys led a partial recovery in the IT sector on Friday, driven by currency dynamics that favour rupee-denominated revenue recognition for dollar-earning technology exporters. The IT sector’s defensive characteristics—recurring large enterprise contracts, dollar revenues, and strong balance sheets—make it a relative safe harbour within the Nifty when macro conditions deteriorate. However, even this support has limits: concerns about global enterprise IT spending cuts amid rising corporate borrowing costs remain a potential headwind for Q3 FY2027 guidance commentary.

The nine-week declining streak for Nifty is notable from a technical perspective as sustained downtrends of this length typically precede either a capitulation event or a decisive policy response. The RBI’s potential reaction to SBI Research’s 50 bps rate hike recommendation could be the key catalyst for either stabilisation or further pressure. Investors monitoring India allocations should track FII flow data weekly, the rupee/USD level at 97.00 as a trigger zone, and TCS/Infosys Q2 FY2027 earnings in October for sector health confirmation.

Source: Business Today | Market News synthesis