By Telis Demos

This week, the AI panic trade is picking off subsectors of finance one by one.

On Monday, it was insurance brokers, hit by news that OpenAI was adding an app for homeowner insurance quotes.

On Tuesday, it was wealth brokers, after financial-technology firm Altruist introduced an AI tool for tax planning strategies.

The next day it was commercial real-estate brokerages. This time, the market can't point to a specific new AI catalyst. But if one kind of broker is on the way out, what is to stop any broker from being displaced?

On Thursday, the decline broadened out across financial-technology companies, seemingly regardless of specialty. Affirm, Shopify, Block and Adyen-all in versions of the payments business, but in different flavors-fell hard.

Even the KBW Nasdaq Bank index, made up of the country's largest regional lenders and Wall Street megabanks, was down around 3%.

Each of these industries certainly could be disrupted by AI. But many of them could equally benefit, too. If investment banks have to hire only a few superbankers, they could keep far more in fees. A wealth advisor adding AI tax planning could sweep up more clients. Banks and traders should generally benefit from the growth and wealth being generated by AI.

At this point it may make more sense to say that the market is raising another economic alarm about AI: That widespread job losses and bankruptcies in the transition would be felt across the financial sector.

Yet that narrative, too, may be hiding more specific fears across finance. If the next Federal Reserve chair aims to shrink the central bank's balance sheet, leverage could be taken out of the system. Investors could simply be expecting fewer rate cuts. Or maybe the view that private credit has funded too much risky lending is winning out.

AI disruption is an easy story to tell. But at some point the narrative gets so convoluted, you have to wonder what else is going on.

This analysis comes from the Journal's Heard on the Street team. Subscribe to their free afternoon newsletter here.

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(END) Dow Jones Newswires

February 12, 2026 14:43 ET (19:43 GMT)

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