From Bubble Fears to Disruption Risk: The New AI Market Narrative
LPL Research analyzes recent market activity, AI anxieties, and possible directions the new technology could be heading in.
Last Updated: February 17, 2026
Wall Street narratives rarely stay still, and recent weeks have underscored how quickly sentiment can change as perceived new information challenges the status quo…
A New Chapter in the AI Story
When uncertainty rises, volatility usually follows as the market has a tendency of pricing in worst-case scenarios quickly…
Another DeepSeek Moment
The recent stretch of volatility across the technology sector has revived comparisons to the DeepSeek shock in January 2025.
Oversold, but is it Over?
Selling pressure has been severe across the software sector…
Valuation Support
The drastic re-rating of software stocks has brought valuations to historically low levels…
Implications for the Broader Market
Weakness across the technology sector (particularly within software) has weighed on the S&P 500 this year…
Conclusion
Overall, the recent volatility across software and AI‑exposed industries reflects a shift in the market narrative rather than a broad breakdown in fundamentals.
Asset Allocation Insights
LPL’s Strategic Tactical Asset Allocation Committee (STAAC) maintains its tactical neutral stance on equities…
Disclosures
This material is for general information only and is not intended to provide specific advice or recommendations for any individual…
References to markets, asset classes, and sectors are generally regarding the corresponding market index…
Any company names noted herein are for educational purposes only and not an indication of trading intent or a solicitation of their products or services.
All investing involves risk, including possible loss of principal.
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