Markets
markets
Matt Phillips

Oracle, Microsoft power battered software stocks toward best 3-day stretch in almost a year

Software shares are rising again early Wednesday, putting the widely watched iShares Expanded Tech Software ETF on track for its best three-day stretch in almost a year.

So far this week, Oracle is up more than 20%, Microsoft is up over 9%, and both ServiceNow and Datadog have gained more than 12%.

Intuit, CrowdStrike, Autodesk, and Atlassian were also among the software shares rising Wednesday after taking lumps on worries about AI disruption earlier this year.

Why the rebound? Mean reversion is a powerful force in markets, and some of these shares could simply be enjoying an overdue snapback.

Bloomberg suggests there’s some “bottom fishing” going on, with investors finally deciding that the price for these still highly profitable, cash flow-positive companies has fallen low enough to make them a compelling bargain.

Pat Tschosik, chief thematic strategist at research firm Ned Davis, told Sherwood News that the market may have been too panicky about software stocks as a whole, slamming the shares of software companies that could survive and thrive in the AI era along with those doomed to disruption.

Determining the difference between the winners and the losers will take a look at the fundamentals of individual companies.

“Somebody who does the homework is going to make a lot of money in these stocks,” he said.

Wall Street Goes Bottom Fishing in Beaten-Down Software Stocks

Wall Street Goes Bottom Fishing in Beaten-Down Software Stocks

So far this week, Oracle is up more than 20%, Microsoft is up over 9%, and both ServiceNow and Datadog have gained more than 12%.

Intuit, CrowdStrike, Autodesk, and Atlassian were also among the software shares rising Wednesday after taking lumps on worries about AI disruption earlier this year.

Why the rebound? Mean reversion is a powerful force in markets, and some of these shares could simply be enjoying an overdue snapback.

Bloomberg suggests there’s some “bottom fishing” going on, with investors finally deciding that the price for these still highly profitable, cash flow-positive companies has fallen low enough to make them a compelling bargain.

Pat Tschosik, chief thematic strategist at research firm Ned Davis, told Sherwood News that the market may have been too panicky about software stocks as a whole, slamming the shares of software companies that could survive and thrive in the AI era along with those doomed to disruption.

Determining the difference between the winners and the losers will take a look at the fundamentals of individual companies.

“Somebody who does the homework is going to make a lot of money in these stocks,” he said.

More Markets

See all Markets
markets
Luke Kawa

Robinhood, Webull gain as SEC approves removal of day trading limit for small investors

Shares of Robinhood Markets and Webull are surging in premarket trading after the US Securities and Exchange Commission gave the green light to removing a rule that had impeded small traders from day trading.

The pattern day trading rule will no longer bar traders from making more than four day trades over a five-day period if their margin account has less than $25,000. The changes were initially proposed by the Financial Industry Regulatory Authority. Under the SEC order published Tuesday after the close of regular trading, all traders, regardless of account size, will just need to have enough in their margin account to cover their exposure.

(Robinhood Markets Inc. is the parent company of Sherwood Media, an independently operated media company subject to certain legal and regulatory restrictions.)

Formerly Soaring Shoe Brand Allbirds Sells Itself For $39 Million

Allbirds, the quarter-zip of footwear, is leaving shoes behind to become an AI infrastructure company

Allbirds shares rocketed higher on Wednesday.

Max Knoblauch5h
markets
Claire Yubin Oh

Snap jumps after revealing plans to lay off ~16% of its workforce, new guidance sees Q1 revenue up ~12% year on year

Snap jumped as much as 10% in premarket trading on Wednesday after the social media company announced that it may cut about 1,000 roles, or roughly 16% of its full-time employees, in an attempt to improve profitability.

In an SEC filling that followed its Investor Update presentation on Wednesday, Snap also added that it will be closing more than 300 open roles. As a result of the job cuts and other measures, the company expects to save roughly $500 million in annualized expenses by the second half of 2026.

Through the latest moves, Snap is “pivoting towards profitable growth,” per CEO Evan Spiegel, doubling down on its more than 60% gross margin target for 2026. It also joins a growing list of tech companies cutting jobs citing AI, with Spiegel adding that “rapid advancements in artificial intelligence [will] enable our teams to reduce repetitive work, increase velocity, and better support our community, partners, and advertisers.”

In the same investor update event, Snap also updated parts of its Q1 financial outlook, including reduced guidance on its stock compensation and adjusted operating expenses. The company now expects revenue of approximately $1.529 billion, up 12% year over year and just above analyst expectations of $1.524 billion, as compiled by Bloomberg. Snap expects adjusted EBITDA to come in at $233 million, again ahead of Wall Street’s current forecasts ($184 million).

markets
Claire Yubin Oh

Broadcom jumps on expanded chip deal with Meta

Broadcom is ticking up 3% in premarket trading on Wednesday after yesterday’s announcement that it will expand its partnership with Meta to produce multi-generation custom chips to power Meta’s in-house AI accelerators through 2029.

As the “first phase of a sustained, multi-gigawatt rollout,” the announcement includes an initial commitment of over 1 gigawatt of computing capacity (or enough to power some 750,000 US homes). JPMorgan estimates that this first deployment implies a $12 billion to $15 billion revenue opportunity for Broadcom.

The partnership also builds on the two companies’ goal to “co-design and scale the hardware required to bring real-time generative AI features and personal superintelligence to billions of people globally” across Meta’s apps.

It’s the latest in a series of positive announcements from Broadcom, which spiked after issuing an optimistic AI sales outlook when delivering its quarterly results last month. The custom chip specialist followed that up with expanded deals with Anthropic and Google, its most important customer.

More broadly, custom chips have been having a moment as hyperscalers look to utilize tailor-made offerings in their data centers for both training and inference, with even Nvidia pouring in $2 billion to Broadcom’s rival, Marvell Technology, proving its commitment to working toward other companies’ hardware integrating well on its platform.

“Overall, Broadcom continues to benefit from the accelerating shift toward custom chip designs by hyperscalers and original equipment manufacturers seeking greater performance, power efficiency, and cost differentiation tightly integrated with their software frameworks,” wrote JPMorgan analyst Harlan Sur following this announcement.

Meta is currently developing its AI silicons with a “portfolio approach,” by matching the right accelerator out of its multi-generation chips to each workload needed for its many apps and services. Broadcom’s XPU platform will allow Meta to design and scale hardwares in a way to best optimize Meta’s custom AI infrastructure. That platform-based strategy will also be backed by Broadcom’s high-bandwidth Ethernet networking technology for better efficiency and precision.

As part of the deal, Broadcom CEO Hock Tan will leave Meta’s board of directors to move to an advisory role on its custom silicon strategy, the companies shared in a joint statement.

Ben Walsh
22h
Stocks rise as risk-on traders are hopeful for a peace deal

This past weekend’s failed talks did little to dampen optimism.

BKN-BULLS-JAZZ-JORDAN DUNK

Latest Stories

Sherwood Media, LLC produces fresh and unique perspectives on topical financial news and is a fully owned subsidiary of Robinhood Markets, Inc., and any views expressed here do not necessarily reflect the views of any other Robinhood affiliate, including Robinhood Markets, Inc., Robinhood Financial LLC, Robinhood Securities, LLC, Robinhood Crypto, LLC, Robinhood Derivatives, LLC, or Robinhood Money, LLC. Futures and event contracts are offered through Robinhood Derivatives, LLC.
©2026 Sherwood Media, LLC