State Street Software ETF Down 20.6% YTD, JPMorgan Sees Rebound in 19 AI-Resilient Names
JPMorgan strategists say that extreme selloff priced in 20.58% year-to-date decline for software ETF XSW and deem near-term AI disruption fears overblown, flagging 19 AI-resilient names like Microsoft and CrowdStrike for potential rotation. They note the S&P software index entered a bear market after fresh AI model releases spurred indiscriminate selling.
1. XSW Performance Overview
State Street’s SPDR S&P Software & Services ETF has fallen 20.58% year-to-date as concerns over AI-driven disruption pushed the S&P software index into a bear market, reflecting broad selling across enterprise SaaS names.
2. JPMorgan’s Resilience Assessment
JPMorgan strategists led by Dubravko Lakos-Bujas argue the market has priced in unrealistic near-term AI disruption risk, citing solid fundamentals and oversold positioning as factors skewing the balance of risks toward a sector rebound.
3. Highlighted AI-Resilient Names
The firm identified 19 software companies deemed resilient to AI-related challenges, including Microsoft, CrowdStrike, Okta and ServiceNow, suggesting these high-quality names could attract rotation from investors seeking durable enterprise franchises.