Just a day after helping power a sharp rebound in technology stocks, Tata Consultancy Services (TCS) turned into one of Dalal Street’s biggest losers on Wednesday, with the stock plunging more than 8% in its steepest single-day decline since the Covid-driven market crash of March 2020.The sell-off erased the gains accumulated during the recent rally and dragged the broader IT pack lower, making TCS one of the biggest contributors to losses in the benchmark Sensex and Nifty indices.Shares of the IT major closed at Rs 2,241.70 on the NSE, down 8.39%. The decline marked the stock’s sharpest single-day fall since March 12, 2020, when it had tumbled around 9% as global markets reeled after the World Health Organisation declared Covid-19 a pandemic, according to an ET report.The sharp reversal comes after a strong run-up in technology stocks over the past few sessions. The Nifty IT index had surged more than 4% on Tuesday, its biggest single-day gain since May 2026, and had advanced nearly 8% over the previous three trading sessions even as the Nifty 50 declined around 2% during the same period.TCS had been among the key beneficiaries of that rebound. The stock gained about 8% across the two sessions leading up to Tuesday’s close of Rs 2,446.90. Wednesday’s sell-off, however, wiped out the entire rally in a single session.
Resistance triggers sharp reversal
Market experts said the stock encountered strong resistance near a key technical zone, triggering profit-booking and renewed selling pressure.“TCS witnessed a sharp decline today, erasing the gains from the previous session. The stock faced strong resistance near its 100-day EMA zone of Rs 2,600–2,605, triggering a sharp reversal,” said Sudeep Shah, Head of Technical Research and Derivatives Research at SBI Securities, ET quoted.“Momentum indicators have also weakened, with the RSI turning lower after approaching the 60 mark, signalling a loss of bullish momentum. Additionally, the stock has slipped below the Bollinger Band midline, a level often considered an important support. With today’s fall, TCS has moved below key short and long-term moving averages, indicating a deteriorating trend,” Shah added.According to him, the Rs 2,210-2,200 zone remains a critical support area for the stock.A breach below those levels could result in further downside pressure, he cautioned.
What are analysts watching now?
Analysts said the speed with which the recent rally was erased has raised concerns about the sustainability of any near-term recovery.Harshal Dasani, Business Head at INVasset PMS, said the latest price action suggests that the rebound witnessed earlier may have been temporary rather than the beginning of a sustained uptrend.“The 9% fall after a 6.53% rebound in the previous session confirms that the earlier move was a dead cat bounce, not fresh accumulation. When a large-cap stock gives back a relief rally this quickly, the market is not reacting to one bad headline. It is repricing the entire low-growth IT model,” he said.Dasani said investors should closely watch the stock’s 52-week low near Rs 2,206.A decisive close below that level, he noted, could weaken the technical structure further because the stock has not established a meaningful support base beneath that zone.On the upside, the Rs 2,400-Rs 2,450 range is likely to act as a significant resistance zone.“Until TCS reclaims that band with strong participation, rallies are likely to meet selling pressure. The company remains a high-quality franchise, but the chart is saying quality alone is not enough when growth is weak, AI risk is rising, and valuations still leave little margin for error,” Dasani said.(Disclaimer: Recommendations and views on the stock market, other asset classes or personal finance management tips given by experts are their own. These opinions do not represent the views of The Times of India)
