Shares of major Indian IT companies, including Infosys, TCS, Wipro, and HCL Technologies, came under sharp selling pressure on Wednesday. The selloff was triggered after Anthropic rolled out a major update to its AI chatbot, raising fears among investors that increasingly sophisticated AI tools could replace routine IT services, impact outsourcing demand, and compress profit margins for tech firms. Market participants worry that enterprises may increasingly rely on AI-driven automation instead of large-scale IT service contracts. Nifty IT index fell by 6%
Infosys share fell by 8% as the saw stock a decline of Rs.135.20. Tata Consultancy Services (TCS) also saw significant pressure, falling to Rs 3,044.20 by 10:47 am, a decline of Rs 181.10 or 5.61%. TCS opened the session at Rs 3,120 and touched a low of Rs 3,031.20 as selling intensified through the morning. Mid-tier IT stocks mirrored the weakness in frontline names. LTIMindtree slipped 6.83% to Rs 5,631 by around 10:49 am, after opening at Rs 5,800 and hitting an intraday low of Rs 5,581. Tech Mahindra declined 6.04% to Rs 1,612.80 by 10:50 am, while HCL Technologies fell 5% to Rs 1,610.50 by 10:51 am, after moving between a high of Rs 1,645 and a low of Rs 1,586 during the session.
Market participants noted that the global sell-off began even before US markets opened, after details of Anthropic's expanded AI tools were posted online. The timing amplified nervousness in Asian markets, which reacted swiftly to the perceived threat of AI replacing white-collar and software-related roles rather than simply enhancing productivity. The company revealed expanded capabilities of its Claude "Cowork" agents, designed to automate tasks across legal, sales, marketing and data roles. These functions are widely seen as core revenue drivers for software firms and IT services providers worldwide. Analysts described the market reaction as a potential "SaaSpocalypse", reflecting growing anxiety that AI could replace, rather than merely support, existing software and outsourcing work.