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Indian shares reversed early gains on Friday, dragged by information technology stocks, after HCL Technologies warned of a potential slowdown in client spending in the industry's key U.S. markets as recession fears weighed.

The Nifty 50 index fell 0.24% at 18,565.30, as of 10:35 a.m IST, with the Nifty IT, which has the second most sectoral weight after financial services, down over 2%.

The S&P BSE Sensex lost 0.26% to 62,407.93. Both the indexes had gained 0.3% during the session.

Speaking in New York on Thursday, HCL Chief Executive C. Vijayakumar said he expected revenue growth for the year ended March 31, 2023 to be at the lower end of its 13.5%-14.5% guidance due to furloughs and drop in spending in some sectors.

All the top losers in the Nifty 50 index were information technology stocks, with HCL Tech, Infosys, Tech Mahindra, Wipro and TCS, leading the decline.

"December 2022 and possibly March 2023 are likely going to be growth challenged quarters for (IT) industry", said Girish Pai, head of research at Nirmal Bang, adding that spending in the sector could be delayed, affecting the revenue further.

Most of the other sectors, however, gained as an overnight slide in oil prices and the easing of China's COVID-19 curbs limited losses.

China announced a shift in policy and loosened zero-COVID restrictions in a move that could restore global supply chains and curb inflation.

The Nifty PSU index rose over 1%, on course to advance for the seventh day in a row, if gains hold.

Among individual stocks, One 97 Communications jumped 7%, the most in a week, after announcing that it will consider a share buyback proposal on Dec. 13.

Oil prices stabilised, but still hovered around 2022 lows, after slipping for the fifth day in a row on Thursday. [O/R]