Wall Street sell-off, AI scare for IT stocks sink sensex 1,069 pts

MUMBAI: A global sell-off in a large number of technology stocks affected investor sentiment on Dalal Street on Tuesday, resulting in sensex sliding by 1,069 points or 1.3% to close at 82,226 points. The current sell-off is on the back of fears that AI models could upend established business models of a large number of IT giants including Indian majors like TCS, Infosys, Wipro and others. Global players like IBM and Accenture too are on the same boat.

The sell-off in IT stocks led to a 4.5% crash in BSE's IT index with the biggest contributors being Infosys (down 3.9%), TCS (down 3.8%), HCL Tech (down 6.1%) and Tech Mahindra (down 6.6%).

The day's session started on a weak note after the US markets closed sharply lower on Monday night. Sensex opened a little over 200 points down, slid through the session and closed a tad off the day's low of 81,935 points.

On NSE too, Nifty showed a similar trend and closed 288 points (1.1%) lower at 25,425 points. According to Vinod Nair, head of research, Geojit Investments, Tuesday's fall was led by significant weakness in IT stocks amid renewed global concerns over AI-driven disruptions and margin pressures for traditional service providers. "Global trade and tariff worries resurfaced as well, with additional pressure arising from US President Donald Trump's warnings on trade deals and reports of possible national security tariffs." In addition, the "escalating US-Iran tensions, marked by embassy staff evacuations and Iran's warnings of wider regional escalation, intensified risk aversion," Nair wrote in a note. The day's slide in the market left investors poorer by Rs 3.6 lakh crore with BSE's market cap at Rs 465.6 lakh crore.