Indian IT stocks could be headed for a strong start after US-listed software and technology companies extended their rally for a second straight session, buoyed by easing concerns that artificial intelligence will severely disrupt the sector.
Among Indian companies, Wipro's American Depositary Receipts (ADRs) rose more than 4% during the US session and were trading 2.41% higher as of 10:16 a.m., signalling a positive opening for the stock in domestic trade. Similarly, Infosys ADR was also trading nearly 3% higher.
The upbeat sentiment was visible across global IT majors as well. IBM gained 1.21%, Cognizant advanced 1.46%, while Accenture climbed 3.15%, indicating broad-based buying in technology services and enterprise software companies.
The US software stocks extended their rally for the second day after a bullish note from Guggenheim Securities, which argued that investor concerns over artificial intelligence disrupting traditional software companies have become excessively pessimistic.
"Valuations imply many software companies will decline into perpetuity because of AI," Guggenheim analyst John DiFucci said in a research note. "We don't believe that to be true." While AI-native companies will undoubtedly increase competition, treating artificial intelligence as the "death knell" for the software industry would be "a hallucination," he added.
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The brokerage upgraded Salesforce, ServiceNow and Check Point Software Technologies from "Neutral" to "Buy", triggering a sharp rally across the sector.
Salesforce surged 4.9%, ServiceNow gained 4.6% and Check Point rose 2.7%, while the iShares Expanded Tech-Software Sector ETF climbed 3.2%.
The positive momentum spilled over to IT services firms. Accenture jumped 7% to $133.17, IBM rose 4% to $292.83 and Cognizant gained 7.14%, helping offset weakness in semiconductor stocks that had weighed on the broader technology sector.
The optimism comes after software companies endured months of selling pressure as investors questioned whether generative AI and autonomous AI agents could significantly erode the competitive position of traditional enterprise software providers.
The software sector has substantially underperformed this year. The iShares Expanded Tech-Software Sector ETF is down about 12% in 2026, while the Nasdaq 100 Index has rallied nearly 19%, largely driven by semiconductor stocks benefiting from the AI boom.
Back home, the improved global sentiment was already reflected in Indian markets. Wipro shares were trading 2.68% higher at Rs 174.69, while the Nifty IT index jumped 4.42% to 26,906, suggesting investors are beginning to look past the AI disruption narrative.
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