Tech Tumbles: AI Sparks 'Software-mageddon'
U.S. software and data services firms extend their market drop amid AI concerns, shedding $1 trillion in value. Key players like ServiceNow and Microsoft are hit hard in a selloff termed 'software-mageddon.' The downturn is part of a broader tech-to-value rotation, elevating volatility across markets.
Shares in U.S. software and data services firms continued their downward spiral for a seventh consecutive session, raising alarms about potential disruption from rapidly advancing artificial intelligence technologies. The S&P 500 software and services index plunged 4.6%, with the sector shedding about $1 trillion in market value since the start of the year.
Major companies such as ServiceNow, Salesforce, and Microsoft saw their stock prices fall sharply, contributing to what investors are calling 'software-mageddon.' Despite some firms like Thomson Reuters reporting stable earnings and boosting dividends, concerns over AI's long-term impact continue to weigh heavily on the market.
The selloff illustrates a shift in investor sentiment away from technology and towards value-oriented sectors like consumer staples and industrials. This rotation has intensified market volatility, affecting equities, commodities, and digital assets. The market's anxiety is further reflected in the rising Cboe Volatility Index, which has reached its highest level since November.
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