TCS, Infosys, Tech Mahindra, other IT shares fall amid AI stocks sell-off on Wall Street

The NIFTY IT index was down 2.54% to 27,562.5 as all components were trading in the red. The index has slipped 5.73% in a week and 5.82% in a month. Year-to-date, it is down 27.58%.

The stock of Tata Consultancy Services slid 1.54% to ₹2,120.70 per share. On June 8, the company had won a multiyear transformation and managed services deal with global life and pensions insurer Canada Life to modernise its IT infrastructure services across its European businesses.

Oracle Financial Services Software, Tech Mahindra, Mphasis and LTM were also down 3.16%, 1.95%, 1.97% and 2.24%, respectively.

Wall Street has been on shaky ground since last week, as artificial intelligence stocks have traded lower after reaching record highs.

AI server producer Super Micro Computer's shares crashed 27.98% on Wednesday after the company announced that it planes to raise $7 billion in equity offerings to meet AI server demand.

Advanced chipmaker Nvidia's shares settled 3.73% lower, while the stock of semiconductor manufacturer Broadcom slipped 5.12%.

The pressure on AI stocks could also be coming due to the upcoming listing of SpaceX, as investors could be pulling out cash to invest in the same.

The US stocks also reacted to escalating tensions between the US and Iran. "Wall Street witnessed a sharp correction overnight, with the Dow Jones falling over 950 points. The weakness was broad-based as investors moved away from risk assets amid fears that escalating geopolitical tensions could disrupt energy markets and keep inflationary pressures elevated," Hariprasad K, Research Analyst and Founder, Livelong Wealth, said.