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RegExp("[?&]notifications=1(&|#|$)");"desktop"===y&&i&&b.test(window.location.search)&&(i.checked=!0)};ge("ybar-mod-notification",(function(e){var t={isUH3:"crunch"===e.getConfig().ytheme,notifContainer:document.getElementById("notification-container"),notifBadge:document.getElementById("notif-badge"),notifMenu:document.getElementById("ybarNotificationMenu"),notifMenuOpener:document.querySelector("#ybarNotificationMenu + label"),notifDropdown:document.getElementById("notifDropdownContainer"),tooltipContainer:document.querySelector(".".concat($n)),notifLabel:document.querySelector(".".concat(Xn))};t.notifDropdown&&so(e,t)}))}()}};]]>Ines Ferré · Senior Business ReporterWed, February 25, 2026 at 5:47 PM GMT+1 4 min readFor weeks, investors have been increasingly concerned that AI is advancing so rapidly that the business models of some of the S&P 500's (^GSPC) most iconic players could take a major hit.What began as a software sell-off last month has rapidly spread to other industries, fueled by fears that AI could undermine traditional software pricing models or replace fee-based services such as brokerage and consulting."There is a wrecking ball bouncing from one industry to the next, and folks are calling it the AI Scare Trade," Craig Basinger, chief market strategist at Purpose Investments, wrote earlier this month.That sentiment was punctuated on Monday by a Substack post from Citrini Research, which noted the potential wipeout of middle-class, white-collar jobs as tasks become automated."In the near term, right now, for us as investors, we have to deal with soured sentiment on AI," Sevens Report founder Tom Essaye told Yahoo Finance on Tuesday morning.Here's how the trade unfolded, and which sectors have taken the biggest hits.The first AI-driven stock market cracks appeared in enterprise software as investors grew concerned that rapidly developing AI tools from Anthropic (ANTH.PVT) could reduce the need for data analytics and research, threatening legacy software's core subscription model.Salesforce (CRM) stock has fallen nearly 30% year to date, while Adobe (ADBE) dropped 25% over the same period amid fears that AI will erode the creative software maker's pricing power. Human resources and workflow platforms ServiceNow (NOW) has declined 30%.Meanwhile, Workday (WDAY) fell to a five-year low on Wednesday after its revenue forecast missed expectations and its CEO tried to dispel AI disruption fears.Wall Street analysts have called the selling overblown. But even after Anthropic announced a wave of software partnerships tied to AI tools, the Tech-Software Sector ETF (IGV) remains down 26% year to date.The sell-off found fresh legs on Monday when Anthropic released a tool to automate the update of legacy code across finance and government, work that traditionally requires costly consultants.Investors flagged the advancement as a threat to IBM's (IBM) revenue streams. Shares of the cloud and software giant rebounded on Tuesday after posting the worst daily loss in 25 years.Cybersecurity firms have been hit after Anthropic announced a new security tool on Feb. 20, impacting shares of CrowdStrike (CRWD), Zscaler (ZS), and Cloudflare (NET).On Monday, those names extended the slide as fresh worries over AI disruption spread through the market. Terms and Privacy PolicyPrivacy & Cookie SettingsMore InfoS&P 5006,938.85 +48.78 (+0.71%)Dow 3049,421.94 +247.44 (+0.50%)Nasdaq23,112.23 +248.55 (+1.09%)Russell 20002,656.89 +4.57 (+0.17%)VIX18.39 -1.16 (-5.93%)Gold5,229.10 +52.80 (+1.02%)Trending tickersCRCL Circle Internet Group 79.26 +17.89 (+29.15%)NFLX Netflix, Inc. 82.08 +4.04 (+5.18%)MELI MercadoLibre, Inc. 1,729.11 -193.45 (-10.06%)CAVA CAVA Group, Inc. 85.08 +17.28 (+25.49%)NVDA NVIDIA Corporation 197.04 +4.19 (+2.17%)PortfolioSign in to access your portfolioSign inTop gainersECG Everus Construction Group, Inc. 136.95 +32.74 (+31.42%)CRCL Circle Internet Group 79.22 +17.84 (+29.08%)CCC CCC Intelligent Solutions Holdings Inc. 6.37 +1.30 (+25.79%)YOU Clear Secure, Inc. 41.81 +8.33 (+24.90%)CAVA CAVA Group, Inc. 84.72 +16.91 (+24.95%)Top losersGDDY GoDaddy Inc. 77.73 -14.57 (-15.79%)VRRM Verra Mobility Corporation 15.84 -2.87 (-15.34%)DEO Diageo plc 88.23 -13.91 (-13.62%)FSLR First Solar, Inc. 211.15 -32.07 (-13.18%)IBRX ImmunityBio, Inc. 10.12 -1.43 (-12.41%)Most activeNVDA NVIDIA Corporation 197.08 +4.23 (+2.19%)IBRX ImmunityBio, Inc. 10.12 -1.43 (-12.41%)PLUG Plug Power Inc. 1.9150 +0.0050 (+0.26%)CRCL Circle Internet Group 79.22 +17.84 (+29.08%)INTC Intel Corporation 45.98 -0.14 (-0.31%)Top economic eventsEarnings eventsMy earnings eventsEarnings events