Indian IT stocks came under heavy pressure on February 4 as a global tech selloff weighed on investor sentiment. The trigger came from rising concerns around artificial intelligence increasing competition across software and services, pushing investors to cut exposure to tech stocks worldwide.
The impact was swift and visible across Indian markets.
Market Performance: Nifty IT Takes a Sharp Hit
The selling pressure dragged the Nifty IT index down over 7%, slipping to 35,909.25 during the session. It emerged as the top losing sectoral index, pulling down benchmark indices like the Sensex and Nifty.
The fall wiped out nearly ₹2 lakh crore in market capitalisation from India’s leading IT companies in a single session.
Main News: Broad-Based Selloff Across IT Majors
Almost every large-cap and mid-cap IT stock was caught in the downdraft. Heavyweights led the decline, reflecting nervousness across the sector rather than stock-specific weakness.
Stock-wise movement at around 12 pm:
- Infosys fell over 8% to ₹1,520.20
- LTI Mindtree dropped more than 8%
- Coforge declined around 8%
- Persistent Systems fell about 7%
- Mphasis slipped around 7%
- Tata Consultancy Services (TCS) declined nearly 7%
- Tech Mahindra dropped around 6%
- HCL Technologies fell close to 6%
- Wipro declined over 4%
The pressure extended beyond pure IT services. Info Edge, the parent company of Naukri.com, also slid around 6%, reflecting broader concerns linked to employment and technology disruption.
What Triggered the IT Stock Decline?
The selloff in Indian IT stocks mirrored sharp declines in global technology markets overnight.
Global investors reacted to fresh developments in artificial intelligence, particularly the launch of new legal-task automation capabilities by Anthropic’s Claude AI. These tools can automate work across:
- Legal processes
- Sales operations
- Marketing workflows
- Data analysis
This renewed fears that AI could disrupt areas traditionally dominated by software and IT services companies—segments once seen as long-term beneficiaries of AI adoption.
Global Tech Markets Set the Tone
The negative sentiment was already building overseas before Indian markets opened.
Key global cues included:
- Nvidia and Microsoft shares falling nearly 3% each
- Alphabet declining 1.2%
- Amazon sliding 1.8%
- Salesforce and Adobe dropping around 7% each
Major US indices also ended lower:
- Nasdaq fell 1.43% to 23,255.19 points
- Dow Jones Industrial Average slipped 0.34% to 49,240.99 points
The weakness in the US tech space directly influenced sentiment toward Indian IT stocks during the trading session.
Company Details: Why IT Stocks Reacted Together?
The fall across Infosys, TCS, Wipro, HCL Technologies, Tech Mahindra, LTI Mindtree, Coforge, Persistent Systems, and Mphasis was sector-wide.
There were no company-specific announcements driving the move. Instead, the reaction reflected:
- Global reassessment of tech sector valuations
- Concerns around AI-led competition
- Risk-off sentiment across technology stocks
This explains why frontline IT companies and mid-sized players moved in tandem.
Summary: AI Fears Trigger Sector-Wide Reset
The sharp correction in Indian IT stocks on February 4 was driven by global tech weakness, not domestic company-level developments.
Key takeaways:
- Nifty IT dropped over 7%, the worst-performing sector
- Infosys, TCS, LTI Mindtree, and Coforge led losses with declines of 7–8%
- Around ₹2 lakh crore in market value was erased
- Global tech stocks fell after AI-related developments raised competition fears
- The selloff spread evenly across large-cap and mid-cap IT names
The session highlighted how closely Indian IT stocks remain linked to global technology trends—and how quickly sentiment can turn when the global narrative shifts.
Source: Moneycontrol
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