New Delhi, Feb 12 The technology sector saw heightened panic selling on Thursday, sending the Nifty IT index down 5.51 per cent to a four‑month low as investors were spooked over AI‑led disruption and weaker hopes for near‑term US interest‑rate cuts.
The combined market capitalisation of Nifty IT constituents collapsed to Rs 27,32,579 crore down roughly Rs 1.6 lakh crore.
Shares of major software exporters tumbled over 5.5 per cent each, with Tata Consultancy Services falling 5.48 per cent to a 52‑week low of Rs 2,750 on the NSE. Infosys slid 5.48 per cent, Tech Mahindra plunged 6.40 per cent, and HCLTech, Mphasis and Wipro each lost about 4.5–5 per cent, leaving the entire IT index deep in the red.
Market participants said the selloff was triggered by renewed fears that advanced AI tools could replace traditional services that generate large revenue streams for Indian IT firms. The launch earlier this month by Anthropic of “Claude Cowork,” an AI assistant with a new automation layer designed to handle complete business workflows.
It had enterprise automation plug‑ins that could reportedly execute multi‑step workflows that have long underpinned software‑services revenues.
International broker Jefferies described the product launch and resultant meltdown in NASDAQ as “SaaSpocalypse,” which meant AI is set to replace these traditional software companies. Some strategists warned of potential revenue deflation of up to 40 per cent if agentic AI displaces traditional services already facing margin pressure.
Adding to the rout, stronger‑than‑expected U.S. jobs data dimmed hopes for imminent Federal Reserve rate cuts. US payrolls rose by 1.3 lakh last month and the unemployment rate fell to 4.3 per cent, figures that market watchers said increase the likelihood of a prolonged period of higher global rates and weigh on growth‑sensitive technology stocks.
Brokerage Motilal Oswal warned that “AI will render much of legacy software and testing redundant,” drawing parallels to how hyperscalers disrupted infrastructure management services.
The upgraded system from Anthropic introduced multiple automation plugins that could perform full operational processes rather than assisting employees inside existing software tools. Many functions that previously required separate software subscriptions could now be moved to this platform, reducing reliance on traditional SaaS platforms.
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