Technology equities suffered steep losses on February 4, as the Nifty IT index plunged over 6 percent to 36,257.15. The sell-off mirrored a global retreat in tech stocks following a breakthrough in autonomous AI that threatens to upend the traditional software and outsourcing model.
The benchmark indices turned negative by late morning on Wednesday, reversing earlier marginal gains as a steep decline in information technology stocks pulled markets lower.
At 11.30 am, the Sensex traded down 0.2 percent, at 83,555, while the Nifty slipped 30 points to 25,697.
Sharp losses among IT heavyweights led losses across benchmark indices, with the Nifty IT index emerging as the worst-performing sectoral index. However, buying interest in energy, power and select consumption stocks provided support to the broader market.
The catalyst for the rout was the launch of a sophisticated automation layer for Claude Cowork by US-based AI developer Anthropic.
Infosys led the decline, with shares dropping over 7 percent to Rs1,538.60 by 10.55 am. Tata Consultancy Services tumbled nearly 6 percent, HCL Technologies lost nearly 5 percent, and Wipro shed around 4 percent.
Mid-cap stocks mirrored the panic as Persistent Systems, LTI Mindtree and Coforge each fell nearly 7 percent, while Mphasis and Tech Mahindra declined more than 6 percent.
The sentiment in India was further dampened by the poor performance of US tech giants on Tuesday. Salesforce and Adobe both crashed around 7 percent on Tuesday, while Nvidia and Microsoft fell nearly 3 percent each.
Anthropic has escalated the threat of industry disruption by introducing 11 new plugins for its Claude Cowork agent. These tools enable the automation of complex workflows across legal, sales, marketing, and data analysis challenging the necessity of traditional software.
Analysts label the sell-off a “SaaSpocalypse”. Markets now fear AI will replace entire enterprise software categories rather than merely boosting productivity through traditional tools.
First Published: Feb 04, 2026, 12:40
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