AI Fears Send Asian Software Stocks Diving - XRO.AX, TISNF, KGDEF, TCS.BO, HCL-INSYS.NS

[Para 1: The Lead] Asian software stocks nosedived, extending a global sell-off triggered by escalating concerns over artificial intelligence (AI) potentially disrupting traditional business models. Xero (XRO.AX), TIS Inc. (TISNF), and Kingdee International Software Group Co. (KGDEF) experienced significant declines, with Xero plummeting 16% in Sydney, the largest drop since 2013. Tata Consultancy Services Ltd. (TCS.BO) and Infosys Ltd. (HCL-INSYS.NS) also fell by at least 7% each. [Para 2-3: Supporting details & Context] The selloff, sparked by AI fears, has spread globally, affecting US and European markets. However, losses were more contained in Asia, where the tech sector is heavily weighted toward hardware, particularly chipmakers, which have been beneficiaries of the AI investment boom. Analysts at Allspring Global Investments noted that Asia’s tech sector appears better positioned during this period of uncertainty, supported by strong earnings momentum in hardware. China faced a larger impact, with software-related firms leading the Hang Seng Tech Index (HSTECH.HK) to a fifth day of decline. Despite this, investors and analysts anticipate limited damage for the region, as pure software in Hong Kong and China remains a smaller component of market indices compared to the US and Europe. The region's tech stocks, including South Korea's Samsung Electronics Co., held up well, with the broader MSCI Asia Pacific Index trading little changed.