Indian Shares Slip as IT Stocks Tumble on AI Disruption Fears
Indian equity benchmarks declined on Thursday, weighed down by sharp losses in information technology stocks amid fading hopes of a near-term U.S. interest rate cut and rising concerns over artificial intelligence-led disruption. The Nifty 50 fell 0.31% to 25,872.05, while the BSE Sensex shed 0.36% to 83,925.18 in early trade. Broader markets also remained under pressure, with small-cap and mid-cap indices declining 0.7% each. Nine of the 16 major sectoral indices traded in the red, reflecting cautious investor sentiment.
The IT pack bore the brunt of the selling, with the NIFTY IT index plunging 4%, extending its recent slide. Stronger-than-expected U.S. jobs data dampened expectations of an imminent rate cut, while mounting fears over AI automation disrupting traditional labour-intensive business models at top Indian software exporters further rattled sentiment. Market experts noted that automation-driven efficiency could reduce billable hours and headcount, potentially weighing on earnings growth in the near term.
Among individual stocks, Lenskart Solutions surged 9.3% after reporting a multi-fold jump in quarterly profit driven by robust demand for prescription eyewear. In contrast, LG Electronics India slipped 3% following a 62% drop in third-quarter profit due to weaker appliance demand, while Jupiter Wagons declined 3.8% after posting lower quarterly earnings. Analysts expect markets to enter a consolidation phase after a recent rally fueled by optimism over the India-U.S. trade deal and sustained foreign institutional inflows, though global tech weakness continues to keep investors risk-averse.
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