Indian technology shares ended July 2026 with one of their strongest monthly performances in years, even as the global AI hardware trade suffered a sharp reversal. The Nifty IT index gained 16.7% during the month while the Philadelphia Semiconductor Index fell 21%, according to Reuters. The contrasting moves reflect a broader rotation: global funds reduced exposure to crowded US and North Asian AI-chip positions and revisited markets and sectors that had previously lagged. The Nifty 50 rose about 2%, South Korea’s KOSPI fell 24%, and Taiwan’s benchmark dropped 7%. Foreign investors bought more than $1.6 billion of Indian equities in July, a change in direction after roughly $29 billion of net selling during the first half. The Nifty IT index outperformed the US chip index by the widest monthly margin since 1999, Reuters reported, citing a Goldman Sachs note dated July 29. Indian IT services companies had spent much of 2025 and early 2026 under pressure due to worries about slow discretionary technology spending, cautious clients, and whether generative AI would reduce labour required for traditional software-development and outsourcing contracts. Those concerns had pushed valuations lower. Fund managers looking to reduce direct exposure to AI hardware could move into Indian software services, financials, healthcare and industrial companies without leaving Asian or emerging-market equities entirely.