No Going Back.
Russia's negative equilibrium.
News Items is as invaluable a way to start the day as a strong cup of coffee or a sip of mild gin" — Graydon Carter, editor and author of ‘When The Going Was Good’.
Editor’s Note: Today’s News Items is longer than most. If you do not get to the Quick Links, click on the link that appears at the end that reads: “View Entire Message”.
1. Bloomberg:
Selling software stocks before the crowd paid off for Nick Evans, a Polar Capital fund manager. His warning to potential bargain hunters: most shares are still toxic and few firms will survive.
“We think application software faces an existential threat from AI,” said Evans, whose $12 billion global technology fund beat 99% of peers over one year and 97% over five.
Fears that sophisticated AI tools like Anthropic PBC’s Claude Cowork will disrupt software businesses sent their stocks tumbling this year. An exchange-traded fund tracking the US software sector is down 22%, a sharp contrast to semiconductor stocks that have soared as AI spurs computing demand.
Application software, which helps users perform tasks such as writing documents and managing payrolls, looks particularly at risk, according to Evans. Apart from a small position and some call options in Microsoft Corp., the fund manager has sold all other holdings in the sector, including SAP SE, ServiceNow Inc., Adobe Inc. and HubSpot Inc. “We won’t go back to these companies,” he said in an interview. (Source: bloomberg.com)
2. Bloomberg:
The stock market turmoil unleashed by the artificial-intelligence industry reflects two fears that are increasingly at odds.
One is that AI is poised to disrupt entire segments of the economy so dramatically that investors are dumping the stocks of any company seen at the slightest risk of being displaced by the technology.
The other is a deep skepticism that the hundreds of billions of dollars that tech giants like Amazon.com, Meta Platforms, Microsoft. and Alphabet. are pouring into AI every year will deliver big payoffs anytime soon.
The dueling anxieties have been brewing for months. But they’ve shifted to the center of the stock market over the past two weeks. The result has been a series of punishing selloffs that have hammered dozens of companies across a number of industries — from real estate services and wealth management, to insurance brokers and logistics firms — and wiped more than $1 trillion from the market values of the big tech companies investing the most in AI. (Source: bloomberg.com)
3. Anthropic has partnered (with) Indian technology firm Infosys to develop advanced artificial intelligence solutions for companies across sectors including telecommunications and financial services. The partners will develop custom AI agents tailored for specific industries and business functions, Infosys said in a statement to exchanges. Anthropic will combine its Claude models, including Claude Code, with Infosys’ Topaz AI products to help companies automate complex work flows and speed up software delivery. Infosys shares gained 4.8% on Tuesday, the most in two weeks, while the benchmark NSE Nifty index rose 0.3%. (Source: bloomberg.com)
