Shares of Indian software exporters fell over 4% on Thursday, driven by growing concerns about AI disruption and diminished expectations for a U.S. Federal Reserve rate cut. The Nifty IT index hit a four-month low, with major players like Tata Consultancy Services, Infosys, and HCLTech declining between 3.7% and 4.4%. This segment has underperformed significantly, down 12.6% in 2025 and 11.4% year-to-date in 2026. The release of Anthropic’s AI tools, including the Claude Cowork tool, raises alarms about the future demand for traditional, labor-intensive IT services, key to Indian firms. With the Fed showing potential reluctance to cut rates amid strong job growth, the outlook for IT spending remains muted, further impacting stock performances. Since February 4, IT stocks have plummeted by 13%, pushing TCS down to the sixth position in market valuation. Consequently, national indices like Nifty 50 and BSE Sensex also declined.
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