IT Stocks Rally on May 18, 2026, Despite Weak Market; Coforge, Tech Mahindra Lead Gains

India’s information technology sector witnessed strong buying interest on Monday, May 18, even as the broader equity market traded in a range-bound manner amid global uncertainties. Stocks such as Coforge, Tech Mahindra, Persistent Systems, Oracle Financial Services Software, Mphasis, and Infosys rallied sharply, helping the NIFTY IT index extend its recent recovery.

Coforge emerged as the top gainer in the sector with a 4.4% jump, while Tech Mahindra climbed 4.1%. Persistent Systems, Oracle Financial Services Software, Mphasis, and Infosys also advanced between 1% and 4.1%. Notably, all 10 constituents of the NIFTY IT index traded in positive territory during the session.

Rupee Weakness and Defensive Positioning Support IT Stocks

According to market experts, the recent weakness in the Indian rupee has improved sentiment toward export-oriented IT companies, which generate a large share of revenue from overseas markets, especially North America.

Analysts also believe investors are increasingly viewing IT stocks as a relatively defensive play amid rising volatility in global markets. Stable export earnings visibility and currency tailwinds have contributed to the sector’s rebound after months of heavy selling pressure.

The NIFTY IT index rose 2.4% intraday to touch 28,358, building on Friday’s 1.3% gain.

AI Concerns and Weak Guidance Still Weigh on Sentiment

Despite the ongoing recovery, the sector continues to face structural challenges. Indian IT stocks have declined more than 25% in 2026 so far, making them one of the worst-performing sectors this year.

Investor sentiment weakened earlier after rapid developments in generative AI raised concerns over disruption to traditional IT services. Companies like OpenAI and Anthropic intensified fears around automation and lower demand for conventional outsourcing models.

Additionally, several large IT firms issued cautious FY27 growth guidance. HCL Technologies, Infosys, and Wipro projected muted growth, reflecting slower global tech spending and macroeconomic uncertainty.

Read more: Vodafone Idea Share Price in Focus as Aditya Birla Group Announces ₹4,730 Crore Investment.

Conclusion

While Indian IT stocks remain under pressure from AI disruption fears and slowing global demand, Monday’s rally indicates improving investor confidence in the sector’s defensive qualities. Currency benefits, resilient deal pipelines, and selective bargain buying are helping tech stocks regain momentum after a difficult start to 2026.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.