The sharp decline followed the launch of a new artificial intelligence tool by US-based startup Anthropic, which recently introduced a product tailored for corporate legal teams. The company, known for its Claude chatbot, said the tool can automate functions such as contract reviews, non-disclosure agreement triage, compliance workflows, legal brief preparation and standardised responses. The development intensified investor concerns about the potential impact of AI automation on outsourcing-driven business models.
Among major IT stocks, Coforge declined 6.31%, Oracle Financial Services Software fell 5.65%, and LTIMindtree dropped 5.63%. Infosys lost 5.58%, while Tata Consultancy Services fell 5.39%. Tech Mahindra declined 5.30%, Persistent Systems slipped 4.87%, and Mphasis dropped 4.56%. Wipro fell 4.25%, while HCL Technologies declined 3.99%.
The sector was also weighed down by stronger-than-expected US jobs data, which dampened expectations of near-term interest rate cuts by the Federal Reserve and added to investor caution toward export-oriented technology stocks.