The global technology sector is currently navigating a period of significant volatility, marked by a sharp correction in IT stocks as of February 24, 2026. This downturn was primarily triggered by a historic 13.15% plunge in IBM shares on Wall Street, wiping out over $31 billion in market value in a single session. This represents the company's steepest one-day decline since October 2000. The catalyst for this sell-off is the launch of "Claude Code" by AI startup Anthropic. This new tool claims to modernize COBOL—a legacy programming language that still powers approximately 95% of ATM transactions and critical banking infrastructure. By automating the exploration and analysis of billions of lines of code, the tool threatens to disrupt the lucrative consulting and mainframe maintenance services that have long been a core revenue stream for legacy tech giants. In India, the fallout has been immediate and severe. The Nifty IT index tanked 3.5% today, hitting a fresh 52-week low. Cumulative losses for the month of February have now reached 20%, with approximately ₹5.05 lakh crore in market capitalization eroded across the sector. Major Indian IT players are facing intense selling pressure. Infosys saw its shares decline by 3.7%, while Tata Consultancy Services (TCS) fell by 3.5%, causing its market capitalization to slip below the ₹10 lakh crore milestone for the first time in over five years. Other notable declines include HCL Technologies and Persistent Systems, both dropping over 4%. Investor anxiety is being fueled by structural concerns. Brokerages have warned of a "deflationary risk" to IT revenues, suggesting that AI-driven automation could reduce the need for large engineering teams and compress billing rates. The "sell first, ask questions later" sentiment has been further compounded by weak performance in US-listed ADRs, with Infosys ADR dropping 10% in the preceding session. Broader market factors are also at play. Rising crude oil prices, currently around $72 per barrel, and renewed global trade tensions following recent tariff remarks have added to the risk-off mood. The benchmark NSE Nifty 50 and BSE Sensex both declined nearly 1% in early trade, largely dragged down by the tech rout. Technically, the Nifty IT index has entered a bearish phase, breaching key Fibonacci retracement levels and forming a "Death Cross" pattern. Analysts suggest that a meaningful recovery may depend on stability in global tech indices and a clearer outlook on how traditional service providers will integrate these disruptive AI tools into their own business models.