4 February 2026
If you are covering the selloff in software and technology stocks, please find below a comment from Ben Barringer, head of technology research at Quilter Cheviot:
“All innovation means there is going to be disruption at some point, and we appear to be at a significant point in that journey for software and IT services companies. The launch of the Claude Cowork agent has sent share prices of these companies into a spin, and this is hurting other tech names too.
“We are not yet at the point where AI agents will destroy software companies, especially given concerns around security, data ownership and use, but this market rout suggests the potential disruption that is on the cards for markets in the coming days, weeks and months. There is a lot of uncertainty around exactly what AI agents can do, and as such investors are choosing to shun the software market altogether, leaving nowhere to hide.
“Software companies have a number of options at this point. They could go out to the market and prove their businesses are not only stable but resilient to the AI disruption; they could look to merger with one another to build scale and aim to innovate; or, most importantly, they could integrate AI into their services and look to drive revenue from the technology, and thus insulating themselves from whatever impact these agents do bring.
“There is, however, a lot of uncertainty out there now and this could easily spread into other market. For now, old world economy stocks, such as energy and consumer staples, are doing well. But nevertheless, during times of volatility people often shoot first and ask questions later. As a result, this is not necessarily an isolated incident and further volatility is likely to come.”
