Infosys Ltd’s 0.90% Weekly Decline: 3 Key Factors Behind the Market Moves

29 December 2025: Heavy Put Option Activity Signals Caution Ahead of Expiry

On 29 December, Infosys saw a significant surge in put option contracts, with 3,707 contracts traded at the ₹1,640 strike price for the 30 December expiry. This activity, amounting to a turnover of approximately ₹10.97 lakhs and an open interest of 5,032 contracts, indicated increased bearish positioning or hedging despite the stock’s technical strength. The stock closed at Rs.1,645.50, down 0.61%, slightly underperforming the Sensex which fell 0.41% that day.

This put buying near the current price level suggested that investors were preparing for potential downside risk or seeking protection amid recent volatility. Notably, Infosys was trading above all key moving averages, signalling sustained bullish momentum, but delivery volumes had sharply declined, reflecting cautious investor participation.

30 December 2025: Bearish Sentiment Intensifies as Stock Declines Further

The bearish tone continued on 30 December, with Infosys emerging as the most actively traded stock in put options again, this time at the ₹1,620 strike price. A total of 5,926 put contracts were traded, generating a turnover of ₹3.56 lakhs and an open interest of 4,664 contracts. The stock price fell further to Rs.1,624.40, a 1.28% decline, underperforming both its sector and the Sensex, which was nearly flat.

This decline marked the fifth consecutive day of losses, with the stock slipping below its 5-day moving average, indicating short-term bearish momentum. Delivery volumes also dropped by 67.1%, signalling reduced conviction among buyers. The heavy put option activity near the current price level suggested that investors were either hedging existing positions or speculating on further downside, reflecting growing caution amid sectoral pressures and macroeconomic uncertainties.

1 January 2026: Institutional Buying Spurs Positive Momentum

After a prolonged downtrend, Infosys reversed course on 1 January, supported by robust trading volumes and renewed institutional interest. The stock gained 0.81% to close at Rs.1,629.50, outperforming the sector’s 0.79% gain and the Sensex’s modest 0.14% rise. Total traded volume reached 23,80,750 shares with a traded value of ₹388.25 crores, highlighting strong market participation.

Delivery volumes surged by 66.82% compared to the five-day average, signalling genuine investor commitment. Technically, the stock remained above its 20-day, 50-day, 100-day, and 200-day moving averages, confirming a bullish medium- to long-term trend despite short-term consolidation below the 5-day average. This rebound marked a potential trend reversal after six consecutive days of decline.

2 January 2026: Week Closes with Mild Recovery but Overall Underperformance

On the final trading day of the week, Infosys continued its recovery, rising 0.68% to close at Rs.1,640.65. The Sensex also gained 0.81%, closing at 37,799.57. Despite the positive close, the stock ended the week down 0.90%, underperforming the Sensex’s 1.35% gain. The week’s price action reflected a complex interplay between bearish option positioning and renewed buying interest, leaving the stock near its opening level.

Daily Price Performance: Infosys vs Sensex

Key Takeaways

Bearish Option Activity: The week was dominated by heavy put option volumes at strike prices near the stock’s market price, signalling increased hedging and bearish sentiment among investors ahead of expiry dates. This activity suggested caution despite the stock’s technical strength.

Price Underperformance: Infosys declined 0.90% over the week, underperforming the Sensex’s 1.35% gain. The initial days saw a sustained downtrend with five consecutive losses, reflecting short-term weakness and waning investor conviction.

Institutional Buying and Momentum Shift: The trend reversed on 1 January with strong institutional participation and delivery volume growth, lifting the stock by 1.10% intraday and signalling renewed confidence. This rebound was supported by the stock’s position above key moving averages, indicating medium- to long-term bullishness.

Technical and Fundamental Outlook: Despite short-term volatility and bearish option positioning, Infosys maintains a robust Mojo Score of 70.0 with a Buy rating, reflecting solid fundamentals and quality metrics. The stock’s liquidity and large-cap status support active trading and institutional interest.

Conclusion

Infosys Ltd’s week was characterised by a tug-of-war between bearish sentiment expressed through heavy put option activity and a late-week recovery driven by institutional buying and positive momentum. The stock’s 0.90% weekly decline contrasted with the Sensex’s 1.35% gain, underscoring near-term challenges amid broader market strength. However, the technical resilience and upgraded mojo rating suggest that while caution is warranted, the stock remains fundamentally sound. Investors and traders should closely monitor option market dynamics, delivery volumes, and sector trends to navigate the evolving landscape for this large-cap IT heavyweight.

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