Mumbai’s stock market witnessed a sharp downturn on Tuesday, with the Sensex plunging 1,068.74 points or 1.28% to settle at 82,225.92. The Nifty also tumbled 288.35 points or 1.12%, closing at 25,424.65. This heavy selling pressure was primarily triggered by a massive selloff in IT stocks, sparked by announcements from AI powerhouse Anthropic.
Anthropic revealed a groundbreaking new tool for its Claude AI model, designed to modernize legacy COBOL code effortlessly. Investors fear this innovation could drastically reduce demand for traditional software services, hitting Indian IT giants hard. The Nifty IT index led the losses, plummeting 4.74% and becoming the day’s biggest loser among sectoral indices.
The rout wasn’t limited to IT. Nifty Realty shed 2.54%, Services dropped 1.46%, Media fell 1.31%, Consumption declined 0.86%, and Infra lost 0.72%. In contrast, some sectors bucked the trend: Nifty Metal rose 0.93%, Energy gained 0.78%, Commodities up 0.70%, PSE climbed 0.56%, and PSU Bank edged higher by 0.29%.
Midcap and smallcap stocks showed relative resilience compared to largecaps. The Nifty Midcap 100 index dipped modestly by 0.32% or 189.30 points to 59,066.35, while Nifty Smallcap 100 fell 0.55% or 93.30 points to 16,958.65.
Among Sensex constituents, NTPC, HUL, Tata Steel, Power Grid, Titan, Axis Bank, and Sun Pharma emerged as top gainers. On the flip side, Tech Mahindra, HCL Tech, InterGlobe, Infosys, TCS, L&T, Trent, Bharti Airtel, HDFC Bank, and BEL were the major losers, reflecting the IT sector’s woes.
Sudeep Shah, Technical and Derivatives Research Head at SBI Securities, noted that the Nifty opened with a significant gap down and weakness intensified throughout the session, hitting an intraday low of 25,328. It closed 1.12% lower at 25,425. He highlighted the 25,370-25,350 zone as crucial support; a break below could drag it to 25,150 or even 24,950. On the upside, resistance lies at 25,600-25,650.
This market reaction underscores growing concerns over AI’s disruptive potential in the software services industry, which forms the backbone of India’s export economy. Investors will watch upcoming earnings and global tech cues closely for signs of recovery.