What happened
IBM shares fell sharply on February 23, 2026, marking its steepest single-day drop since 2000, following Anthropic's announcement that its Claude Code tool can automate COBOL modernisation, directly threatening IBM's legacy business. This coincided with a broader market sell-off, impacting Visa, Mastercard, Accenture, and Cognizant Technology, after Citrini Research's viral Substack post warned of an AI-driven market crash, widespread white-collar layoffs by 2028, and reduced consumer spending. Financials and consumer discretionary sectors led declines, with the S&P 500 remaining flat for the year.
Why it matters
Investor sentiment shifted from AI-driven growth to disruption risk, re-evaluating business models reliant on traditional services. Procurement teams and founders now assess vendor resilience against AI-powered coding tools, which reduce development timelines from years to quarters. This re-pricing of risk, particularly in financial services and consulting, reflects concerns over cash flow and capital expenditure, echoing earlier devaluations of wealth managers. Companies with proprietary data and complex workflows gain a competitive edge against this rapid automation.
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