Nifty IT drops up to 6% on Anthropic tool launch

Nifty IT slipped 5.87% to 36,345.65 points as U.S.-based tech company Anthropic’s new legal tool on Claude spooked American markets sending tech stocks southwards on Wednesday (February 4).

All the 10 IT majors in the Nifty IT index dipped with Infosys falling 7.4% , followed by Tata Consultancy Services Ltd., which fell 7% and the degree of crash in the stock prices of the other eight companies which include Wipro Ltd was between 4% and 6%. BSE IT fell 5.5% to 35,109.51 points and 20 of the 30 stocks in the index  slipped.

The drop in stock prices of IT companies is a reaction to the fall in US IT stocks overnight. NVIDIA Corp fell 2.38% to $180.34 , Alphabet Inc fell 1.16% to $339.71, Microsoft Corporation  was down 2.8% to $411.21 among other major tech stocks on the NASDAQ.

The jitters were an outcome of Anthropic, which introduced legal tools in Claude Chatbot which reportedly has the possibility of replacing services produced by software companies. 

“Indian IT stocks slid in tandem with Wall Street, mirroring the overnight sell-off in U.S. technology shares. The decline comes amid fresh investor jitters that rapid advances in artificial intelligence could intensify competition for traditional IT companies—sparked most recently by Anthropic’s launch of a legal-focused tool for its Claude AI chatbot. That said, it may be premature to draw sweeping conclusions. The impact of such AI innovations is unlikely to be uniform across all IT verticals, and many segments could remain largely insulated in the near term. For now, the market reaction appears driven more by sentiment than by clear evidence of structural disruption,” said Sumit Pokharna, VP Fundamental Research of  Kotak Securities