MW Software stocks fall for an eighth straight day, with a sweeping roster of decliners

By Hannah Pedone

Financial-data stocks are big losers as investors worry about the threat AI poses to tools for modeling and analysis

Investors are increasingly worried that AI tools will eat into traditional financial software offerings.

As the software sector got battered for an eighth straight session Thursday, the losses were widespread.

Of the 114 stocks in the iShares Expanded Tech-Software ETF IGV, there were 102 decliners, according to Dow Jones Market Data. That ETF has now suffered its worst eight-day performance in almost six years, with losses of about 19% over this most recent span, including Thursday's roughly 5% drop.

And software stocks outside that ETF suffered as well, including FactSet Research Systems $(FDS)$, which fell 7% on Thursday and extended its weekly losses to 16%. Investors are fretting that new artificial-intelligence tools could make it easier for users to conduct financial research without relying on fancy legacy tools.

The financial-sector pain extended to shares of S&P Global $(SPGI)$ and Nasdaq $(NDAQ)$, which both fell roughly 3% on Thursday, bringing their week-to-date losses to 14% and 12%, respectively. The stocks are now on track for their worst weekly performances since March 2020, according to Dow Jones Market Data.

Read: Why Microsoft's stock just lost a big fan in the wake of Alphabet's earnings

One issue weighing on financial-data stocks is that AI startup Anthropic has a new model, Claude Opus 4.6, that can automate financial analysis and tasks like creating spreadsheets and presentations, according to a press release. The model also has integrations with Excel and PowerPoint.

Read more: Software ate the world. Now, Wall Street is worried AI will eat software.

Earlier in the week, Anthropic's announcement of a new plugin for legal tasks added to existing pressure on software stocks, which have been hit hard in recent months related to fears that AI will upend the enterprise-software industry.

"These fears of AI disruption have grown from worries about seat-based business models to more general existential risk perceptions, and investors are showing little tolerance for anything controversial when it comes to AI-related disruption," Macquarie analyst Steve Koenig said in a note to clients.

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Gil Luria, an analyst at D.A. Davidson, said that Anthropic's new product launches are causing investors to rethink how fast AI may disrupt businesses.

New AI tools "perform tasks that used to take people far longer to execute," he said. "That's a concern for investors."

Luria, like some other analysts, says there's room for investors to selectively dig for bargains. He thinks now is a good time to buy stocks of companies that will adapt well to AI, naming Microsoft $(MSFT)$, ServiceNow (NOW), Snowflake (SNOW) and Datadog (DDOG) among such options.

Koenig sees pockets of opportunity as well, saying that where there's "relatively less risk (and perhaps less opportunity for applying agentic AI) are policy-compliant core enterprise workflows" in human resources, information technology and related fields.

-Hannah Pedone

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February 05, 2026 19:03 ET (00:03 GMT)

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