Computing giant IBM shares were a victim of the AI ‘scare trade’ on Monday, suffering their worst day in more than a quarter-century with declines of almost 13.2% in the session amid a new challenge to its business model.
Anthropic said that its Claude Code could be used to modernise Cobol — the programme language run on IBM computers.
“COBOL modernization differs fundamentally from typical legacy code refactoring. You aren’t just updating familiar code to use better patterns, you’re reverse engineering business logic from systems built when Nixon was president,” Anthropic wrote in a blog on Monday.
“Modernizing a COBOL system once required armies of consultants spending years mapping workflows. This resulted in large timelines and high costs that few were willing to take on. AI changes this.”
This revelation spooked investors.
For the year-to-date IBM stock has lost nearly a quarter of its value. In February it has seen its biggest one-month dip since 1968, according to Bloomberg data. Its stock price ticked up 1.5% in premarket on Tuesday morning.
223.35 -33.81 (-13.15%)
At close: 23 February at 16:00:02 GMT-5
A post on blogging platform Substack knocked confidence in a number of tech stocks in Monday trade, as Citrini Research — founded by finance writer James van Geelen — set out a scenario in 2028 where AI disruption has shaken up tech business models, caused mass unemployment and collapsed consumer spending.
The model he sets out name checked a number of cases where agentic commerce and vibe coding challenges the dominance of delivery apps like Uber Eats and DoorDash.
“The sole intent of this piece is modeling a scenario that’s been relatively underexplored,” the article, published on Sundsay, said. “Hopefully, reading this leaves you more prepared for potential left tail risks as AI makes the economy increasingly weird.”
Among others, Uber’s stock fell 4.3% on Monday. American Express (AXP), Mastercard (MA) and Doordash (DASH) also took a hit.
70.72 -3.14 (-4.25%)
At close: 23 February at 16:00:02 GMT-5
Delivery company FedEx saw its stock dip in premarket trade on Tuesday following news that it is suing the US government for a full refund plus interest for what it doled out in trade taxes.
The company filed the lawsuit in the US Court of International Trade after the US Supreme Court ruled president Trump’s tariffs, issued under the International Emergency Economic Powers Act, unlawful.
FedEx stock fell 1.2% in Monday trade.
383.71 -4.77 (-1.23%)
At close: 23 February at 16:00:03 GMT-5
US telehealth company Hims & Hers saw its stock futures fall more than 5.5% on Tuesday, selling off as its first-quarter guidance fell short of expectations. For the year-to-date the stock is down more than 50%.