Wall Street is in the grip of
disruption worries from AI. It first started with investors
dumping shares of software companies but soon spread to sectors
seen as vulnerable to automation, driving sharp losses in U.S.
stocks this week.
The AI scare trade did not spare even sectors such as
private credit, real estate brokers, data analytics, legal
services and insurers.
Global tech stocks took the hit after Anthropic unveiled a
legal AI plug-in. But soon the investor unease deepened
following a flurry of AI model upgrades and fresh releases.
“With fear driving market sentiment, investors remain in
‘sell first think later’ mode, asking ‘who is next’ and showing
no mercy for anything remotely seen as an AI loser,” Barclays
equity strategist Emmanual Cau said.
Here’s a look at how various sectors were impacted by the
selloff:
SOFTWARE AND SOFTWARE-EXPOSED LOANS
The S&P 500 Software & Services index has lost
about $2 trillion in value since its peak in October. Half of
the losses came in the past two weeks, on concerns that
fast-advancing AI tools could upend traditional subscription and
enterprise tools.
So far this year, the worst-performing Nasdaq 100 stocks
include Atlassian down 47%, Intuit down 40%
and Workday, which has lost a third of its value.
Salesforce tumbled about 30% in 2026, while Adobe
is down 25% and CrowdStrike 12%.
“There’s this idea that AI is somehow going to replace
built-out models in the near term – models that have been in
place for many years and from which companies have profited
strongly,” said Robert Pavlik, senior portfolio manager at
Dakota Wealth in Fairfield, Connecticut.
The U.S. software sector’s worst drawdown in more than three
years also knocked down shares of alternative asset managers on
concerns over their exposure to loans and leverage tied to the
companies.
Ares, Blackstone, Blue Owl, Apollo
, TPG and KKR slumped between 13% and 24%
this year.
About a fifth of the private credit space is exposed to the
software sector, according to estimates from BNP Paribas.
FINANCIAL BROKERAGE, DATA ANALYTICS & LEGAL SERVICES
The financial industry, particularly brokerages and data
analytics firms, were hammered after wealth management firm
Altruist introduced AI-enabled tax planning features, stoking
fears of the fast-advancing technology upending their business
models.
Shares of brokers LPL Financial, Raymond James
Financial and Charles Schwab fell more than 7%
on Tuesday.
Index provider S&P Global, which issued a downbeat
earnings forecast for 2026, has slumped more than 25% in
February and was set for its worst month since 2009. Moody’s
, Factset Research and MSCI also fell
sharply this month.
Nasdaq-listed shares of Thomson Reuters touched a
near five-year low last week on concerns about AI hurting its
legal services business.
REAL ESTATE SERVICES
Commercial real estate and investment managers took a blow
on Wednesday, which KBW analysts said was due to investors
rotating out of high-fee, labor-intensive business models viewed
as potentially vulnerable to AI-driven disruption.
CBRE Group and Jones Lang LaSalle sank
about 12% each on Wednesday, and Cushman & Wakefield
slumped nearly 14%. CoStar Group, owner of
Apartments.com and Homes.com, fell 5.9%.
“We view market concerns as overstated due to a combination
of fragmented CRE end markets and the noncore nature of real
estate activities for many clients,” Morningstar analyst Sean
Sunlop said, noting that their valuations were “not cheap”
despite the selloff.
INSURANCE
Insurance stocks took a sharp hit. Brokers and underwriters
across both sides of the Atlantic plunged after online platform
Insurify released on Monday an AI-powered comparison tool on
ChatGPT, which allows users to compare car insurance rates.
The S&P 500 insurance index slumped 3.9% on Monday,
its biggest single-day drop since mid-October.
Shares of insurance broker Willis Towers Watson have
shed 15% so far this week and were set for its worst week since
the pandemic-selloff in March 2020. Aon fell 9% and
Arthur J. Gallagher dropped 15% this week.
“Ultimately, we believe brokers will bifurcate. Simpler
insurance products like term life, personal auto, and home,
could see significant AI disruption over the next five years,”
Morgan Stanley equity strategist Bob Jian Huang said.
“Higher-valued brokers will use AI to enhance analysis and
improve underwriting, not be displaced by it, in our view.”
TRUCKING & LOGISTICS
Traders probably did not see trucking and logistics firms as
an AI target, but the sector plunged sharply on Thursday.
AI-focused logistics firm Algorhythm Holdings,
which previously sold karaoke machines, said its SemiCab unit
boosted customers’ freight volumes by 300% to 400% “without a
corresponding increase in operational headcount”.
The news triggered a rout in stocks such as Landstar System
and C.H. Robinson. The Dow Jones
Transportation Average fell 4.4%.
Jefferies analysts, however, said the reaction was
disconnected from fundamentals. “Proprietary freight data and
physical networks remain durable moats,” they said.
Published on February 13, 2026
