IT stocks slide as AI automation signals an agentic shift

Shares of top Indian information technology services were battered on Wednesday, mirroring the decline in US technology and software stocks over renewed fears of disruption caused by artificial intelligence.

- Agnidev Bhattacharya & Jas Bardia

Shares of TCS, Infosys, HCL Tech, Wipro, and Tech Mahindra were down 6.95%, 7.19%, 4.22%, 3.73% and 4.12%, respectively, at close on Wednesday, while the Sensex was largely flat at 83,817.6 points.

The selloff was triggered by a new tool from Anthropic, called Claude Cowork Plugins, which showed the Al industry can now unlock lucrative enterprise revenue. The impact was not limited to technology companies. Advertising stocks also stayed under pressure with France's Publicis down 4.1% and Britain’s WPP losing 3.3%.

Fractal co-founder Srikanth Velamakanni attributed the fall in Indian IT services stocks to the new AI automation tools. “In India, a lot of enterprise services rely on unstructured data. Those stocks are clearly going to be compressed because AI models are increasingly doing an amazing job of interpreting unstructured data - video, voice or text,” Velamakanni said in reply to a query from Mint.