Software rout deepens as AI fears grip investors
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US software stocks fell sharply as Anthropic's newly launched Claude Mythos AI model reignited investor fears about AI disrupting legacy software. The S&P 500 Software and Services Index is down 25.5% year-to-date. Mythos, described as highly capable, was withheld from broad release due to concerns it could expose hidden cybersecurity vulnerabilities — access was limited to ~40 tech companies including Microsoft and Google. Cybersecurity firms like Cloudflare, CrowdStrike, and Zscaler saw significant declines, as did enterprise software companies including Salesforce, Adobe, and Atlassian. The anxiety is also spreading to private credit markets, with investors questioning lending to tech firms amid uncertain growth prospects.
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