AI Tech Rout Plunges Indian Stocks: Netweb Technologies and Peers Fall as Global Markets Pivot Amid Valuation Fears
Shares of several technology and data centre companies experienced significant pressure on Monday, reflecting a sharp global sell-off in tech stocks. The weakness was concentrated in AI-linked plays, amid rising investor concerns over valuations across the sector globally.Among the notable decliners, Netweb Technologies plunged 7.37 percent, falling to Rs 4,322.10 and becoming one of the worst-performing AI-related stocks on the day. E2E Networks declined by 4.99 percent, trading at Rs 430.30, while Anant Raj shed 2.89 percent, settling at Rs 553.60. Black Box also traded lower, falling 2.65 percent to reach Rs 1,044.50.
Global Tech Sentiment Drives Risk-Off Shift
The downturn in India's AI sector mirrored a broader global retreat from technology counters. This came after the Nasdaq experienced a decline exceeding 4.5 percent last week. International tech giants reported declines across major markets.In Asia, Samsung Electronics and SK Hynix dropped roughly 5 percent and 2 percent respectively, leading to a sharp dip in the Kospi. Taiwan Semiconductor Manufacturing Company (TSMC) declined 2.1 percent, while Foxconn slipped by 5.1 percent. Japanese technology saw heavy selling, with SoftBank Group dropping 7.5 percent.
International Market Pressure on Chip and Equipment Stocks
The global decline extended to specialized equipment manufacturers in Japan. Tokyo Electron fell 6.7 percent, while Advantest also retreated by 5 percent. These declines underscore the current risk-off sentiment gripping worldwide technology markets.The coordinated selling reflects widespread investor anxiety regarding hyper-concentrated AI valuations across key tech hubs. The movement suggests a global pivot away from high-growth, concentrated plays toward more diversified opportunities.
Expert View: A Managed Rotation Rather Than Panic Sell-Off
Khushi Mistry, Research Analyst at Bonanza, provided commentary on the current trade pattern, characterizing it as a selective rotation rather than market panic. She noted that the Broadcom-triggered sell-off has exposed fragility in hyper-concentrated AI markets in Korea and Taiwan.The Dow versus Nasdaq divergence observed on the day confirms this is a rotation movement. Mistry argued that India remains structurally under-owned, with Foreign Portfolio Investors (FPI) being underweight, suggesting a logical destination for inflow.
Future Outlook: Domestic Sectors as Strategic Focus Areas
The analyst suggested that the current play is not broad-based but concentrated in domestic sectors. These include financials, consumption, and infrastructure stocks, which offer genuine earnings recovery visibility anticipated by FY27.A full rotation trade, however, requires the AI sell-off to deepen and stabilize before shifts can be finalized. The three leading indicators Mistry highlighted for tracking future market direction are Nasdaq movements, FPI daily flow data, and the rupee trajectory.
Disclaimer: Due care and diligence have been taken in compiling and presenting news and market-related content. However, errors or omissions may arise despite such efforts.
The information provided is for general informational purposes only and does not constitute investment advice, a recommendation, or an offer to buy or sell any securities. Readers are advised to rely on their own assessment and judgment and consult appropriate financial advisers, if required, before taking any investment-related decisions.
Any views, opinions, or statements expressed, where applicable, are those of the respective analysts or experts and do not reflect the views of this website. The website has no association with such viewpoints and does not assume any responsibility for them.