Infosys, Wipro, Persistent, other IT shares in focus after overnight sell-off in SaaS stocks

Shares of Indian IT companies, Infosys Ltd., Wipro Ltd., Tata Consultancy Services Ltd. (TCS), Persistent Systems Ltd., Coforge Ltd., among others will be in focus on Wednesday, February 4, after the software stocks in the US sold-off sharply overnight on resurfaced concerns about the viability of their business models.

US Software stocks led by Gartner plunged as much as 25% in intraday trading on Tuesday on Wall Street. Gartner eventually ended the day with cuts of 21%. Other major SaaS names, Adobe, Salesforce, Microsoft, also fell between 3% to 8% overnight. The moves reflected on the Nasdaq as the index fell over 350 points overnight.

The fall in these stocks also had an impact on the US-listed ADRs of Infosys and Wipro, which also declined 6% and 5% respectively overnight.

A major trigger behind the sell-off was the launch of Anthropic PBC's legal automated tool, which first led to selling pressure in stocks associated with legal and data services technology. The overnight sell-off seen in stocks across software, financial services and asset management, wiped out over $285 billion in market value on Tuesday.

India, generally viewed as an anti-AI trade by analysts, is also a major software services provider for many US companies. However, the overall sentiment around software stocks on Wall Street has been bearish, so much so, that Jefferies has gone on to call it a "SaaSpocalypse", stating that the general sentiment around these trades has been one of "get me out."

The Nifty IT index gained 1.4% on Tuesday, in-line with the broader market rally. However, the index has not done much so far in 2026, gaining 2%, while it is flat over the last one month. Over the last three months though, the index has risen 8.3%.