February 4, 2026 By [Selvarani M]
Software and technology stocks are seeing a sharp
sell-off, driven by renewed investor concerns about how AI could disrupt
established business models. Major markets saw significant losses in companies
like Salesforce, Datadog, Adobe, and others, which impacted software and
technology benchmarks. Major global indices are mixed to lower.
Performance
of US and Global Indices
The Nasdaq Composite and S&P 500 are under
pressure, primarily due to declines in technology heavyweight stocks and
valuation concerns related to AI competition. Commodities like gold have
rebounded strongly, often indicating risk aversion among investors. The Growth
Story - Alphabet (Google) - Today's tech bright spot is Alphabet's stock, which
is rising, driven by strong investor confidence in its AI strategy (including
Gemini advancements) and expected robust revenue growth. Analysts are highlighting
Alphabet as one of the best-performing big tech stocks amidst the current
turbulent conditions. Positive Leadership Voices: Nvidia's CEO Jensen Huang
publicly pushed back against the sell-off narrative, calling the market
reaction to recent AI advancements "illogical," aiming to reassure
investors.
Key
Technology Weakness Drivers Today
AI Disruption Fears: A key catalyst for the tech
sell-off is a newly released AI tool (from Anthropic) aimed at automating legal
workflows, which triggered selling in traditional software stocks. Rotation and
Valuation Concerns: Investors are rotating out of certain technology sectors
into defensive assets (such as gold) or cyclical sectors due to fears that some
technology valuations have run too high.
Macro
& Market Environment
Mixed Economic Signals: Some global indicators, such
as strong manufacturing data in Japan and China, are positive, but economic
data remains uneven across regions. Earnings & Outlook: Despite current
tech weakness, expected earnings from major tech companies (including upcoming
reports from Alphabet, Arm, and others) are a key watchlist item for markets.
What's Actually Happening Today: Tech Leadership Growth in Specific Names:
Alphabet is showing strong growth today. Broader Tech Sector Sell-off: Most tech
stocks – particularly software & IT companies – are declining due to AI
disruption concerns. Market Rotation: Investors are rotating out of some tech
names and into safer or cyclical assets such as commodities or value sectors.
In summary, while the user's requested title ("Tech stocks have registered
strong growth today") suggests a bullish trend, the actual global market
today presents a more nuanced picture. There is selective growth in some tech
giants (e.g., Alphabet), widespread weakness in the broader tech sector, and
volatility related to sentiment on artificial intelligence and macroeconomic
uncertainties.
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