Concerns about the potential negative impact on the industry triggers global sell-off in software stocks
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Jensen Huang, Nvidia
Software stocks worldwide recorded a substantial drop on Tuesday and Wednesday, fuelled by concerns about the potential impact of AI on the industry. Jensen Huang, CEO of Nvidia, addressed these fears during an AI conference organised by Cisco Systems in San Francisco. He rejected the notion that AI would replace existing software tools, calling that illogical. Huang stressed that AI depends on using the tools already available rather than reinventing them from scratch, according to a report by Reuters.
Huang compared the situation to a human or robot having to choose between using existing tools and reinventing them. He pointed out that recent advances in AI focus on improving the use of tools because they are inherently designed for explicit functionality.
The sell-off, initially sparked by Anthropic’s revamped chatbot last week, spread across major markets, including India, Japan and China. Indian IT exporters saw a fall of around 6%, with Infosys suffering a sizeable drop of more than 7%.
Similarly, China’s CSI Software Services Index fell by 3%, while Kingdee International Software Group in Hong Kong plunged by more than 13%. Japanese staffing agency Recruit Holdings and Nomura Research also recorded losses of 9% and 8% respectively.
Business AM