Global software, data firms slide as AI disruption fears compound jitters over $600 billion capex plans

Global technology and data stocks slid again on Friday, as a rout showed no signs of abating on worries over the impact of powerful new AI models on their business and the billions hyperscalers plan to spend on their tech roll out this year.

The risks to software and data and analytics firms following the release of a new plug-in from Anthropic’s Claude has jolted world markets this week, just as some of the so-called hyperscalers unveil plans to spend over $600 billion on their various AI rollouts this year.

Amazon shares dropped 8 per cent in premarket trading on Friday after the company’s hefty capital expenditure plans deepened investor worries over Big Tech’s AI spending spree.

London-listed data and analytics firm RELX, meanwhile, slid almost 5 per cent, while Sage fell nearly 4 per cent and Experian fell over 2 per cent.

Shares in London Stock Exchange Group also fell further and was set for a second straight week of steep losses. The stock is down 7 per cent this week.

Europe’s Capgemini fell 3 per cent and Wolters Kluwer was down nearly 4 per cent.

This week’s drawdown in AI-exposed shares has weighed on broader equity markets.

Global shares are on track for the worst week since November, down 1.6 per cent.

The broad S&P 500 index is off 2 per cent this week, while U.S. software and data services companies have burned around $1 trillion in market value since January 28 alone.

“Fresh AI bubble fears are surfacing after big tech companies massively increased their capex spending for the year – about $650 billion across the four hyperscalers who have reported earnings over the last fortnight,” said Neil Wilson, Saxo UK Investor Strategist, in a note.

The rout has been particularly acute in India. Indian software exporters plunged another 2% on Friday and looked set to end a tumultuous week that has seen $22.5 billion in market value losses.

India’s IT index has shed almost 7 per cent this week.

Investor nerves over potential AI‑driven disruption are coinciding with a growing tendency to punish big tech firms for signaling even heavier spending on the technology.

Google parent Alphabet also upped its spending plans on Thursday, sending its stock down as much as 8 per cent intra-day though they ended Thursday largely flat. Shares were trading flat in premarket trading on Friday.

“A recurring theme is emerging: both Alphabet and Amazon delivered strong underlying business performance, driven by better-than-expected growth in cloud. But that hasn’t been enough to distract markets from their ballooning capital investment plans,” said Aarin Chiekrie, equity analyst, Hargreaves Lansdown.