Tech Rotation Swings Back Toward Software -- WSJ

By Xavier Martinez

A trade that has punished software stocks in favor of semiconductors is reversing this week. An iShares ETF tracking software stocks is up roughly 6.5%, while another ETF tracking semiconductor producers has dropped about 5.7%-a more than 12-percentage-point gap.

-- Software's beaten-down names such as ServiceNow, Intuit and Salesforce-which are each down more than 15% so far this year-were among the S&P 500's best-performing stocks Thursday.

-- Meanwhile, semiconductor stalwart Nvidia was recently down about 1.3%, while Corning, a fiber-optics supplier and recent AI darling, is one of the worst-performing in the S&P 500, recently down 8%.

-- Software has seen a rough start to 2026, as investors weigh whether AI will cannibalize demand for traditional software products. Meanwhile, semiconductors have fared better, buoyed by massive data-center spending from major tech companies.

-- Still, this week's results haven't reversed the overall trend. TSMC and ASML have each surged to start the year, while the software ETF is down more than 17% this year.

This item is part of a Wall Street Journal live coverage event. The full stream can be found by searching P/WSJL (WSJ Live Coverage).

(END) Dow Jones Newswires

March 05, 2026 14:20 ET (19:20 GMT)

Copyright (c) 2026 Dow Jones & Company, Inc.