Jonathan Kitchen/DigitalVision via Getty Images One of Wall Street's favorite sectors just hit the reset button after a significant update to Anthropic's "CoWork" platform. In recent weeks, according to Fortune , the U.S. software sector experienced a widespread sell-off, losing over $1 trillion in market value, after news broke about Anthropic's new agentic artificial intelligence (AI) capabiliti...
Jonathan Kitchen/DigitalVision via Getty Images One of Wall Street's favorite sectors just hit the reset button after a significant update to Anthropic's "CoWork" platform. In recent weeks, according to Fortune , the U.S. software sector experienced a widespread sell-off, losing over $1 trillion in market value, after news broke about Anthropic's new agentic artificial intelligence (AI) capabilities. 1 Now, investors are grappling with an important question: Could advances in AI, including those from Anthropic, fundamentally reshape how businesses use software? We believe the concern is not purely theoretical. Anthropic’s recent advancements in its AI systems and agentic workflow automation seem to have captured the attention of both enterprise leaders and Wall Street, fueling speculation that companies may one day rely less on traditional software subscriptions and more on intelligent agents capable of executing tasks autonomously. How Does Anthropic’s AI Work? Anthropic’s vision centers on AI agents that function less like tools and more like digital colleagues. Rather than navigating multiple applications, users can delegate complex workflows to an AI system that operates across various platforms. The concept behind systems sometimes described as “co-worker” agents or autonomous task bots is straightforward but powerful: combine large language models (LLMs) with memory, reasoning capabilities, and secure integrations into enterprise environments. LLM function calling plays a key role here. It allows the model to trigger application programming interfaces (APIs), software interfaces, or internal tools on the user’s behalf, which is what makes this kind of AI feel more like a coworker than an advisor. The agent can interpret goals, break them into steps, use these software interfaces or APIs to actually execute tasks, and adapt as conditions change. Will Human User Interface Transition To Agent Interface? The idea that AI, like Anthropic-style “co‑workers” and agen...
China’s Ministry of Finance released its draft 2026 budget report, including plans for a more proactive fiscal policy to support the domestic market, advanced technology and public welfare. Major central government expenditures: National defence: 1.91 trillion yuan, up 7 per cent Debt interest payments: 874 billion yuan, up 6.7 per cent Science and technology: 426 billion yuan, up 10 per cent Publ...
China’s Ministry of Finance released its draft 2026 budget report, including plans for a more proactive fiscal policy to support the domestic market, advanced technology and public welfare. Major central government expenditures: National defence: 1.91 trillion yuan, up 7 per cent Debt interest payments: 874 billion yuan, up 6.7 per cent Science and technology: 426 billion yuan, up 10 per cent Public security: 258 billion yuan, up 5.9 per cent Education: 192 billion yuan, up 5 per...
Torsten Asmus/iStock via Getty Images Key Takeaways Markets: The fourth quarter capped a volatile and demanding year for small cap investors. The Russell 2000 Index returned 2.2% for the quarter and finished the year up 12.8%, trailing the Russell 1000 Index by approximately 450 basis points. A partial rotation away from the dominant AI trade supported value stocks over growth during the quarter, ...
Torsten Asmus/iStock via Getty Images Key Takeaways Markets: The fourth quarter capped a volatile and demanding year for small cap investors. The Russell 2000 Index returned 2.2% for the quarter and finished the year up 12.8%, trailing the Russell 1000 Index by approximately 450 basis points. A partial rotation away from the dominant AI trade supported value stocks over growth during the quarter, with the Russell 2000 Value Index returning 3.3% compared to a 1.2% gain for the growth index. Contributors: Holdings in Arrowhead Pharmaceuticals ( ARWR ), Celcuity ( CELC ) and Photronics ( PLAB ). Stock selection in the financials and energy sectors and underweight to IT. Detractors: Holdings in Concept Therapeutics ( CORT ), MP Materials ( MP ) and Penguin Solutions ( PENG ). Stock selection in the materials, IT and communication services. Outlook: Despite near-term headwinds, attractive relative valuations and early signs of earnings broadening point to a more constructive setup for patient investors. Performance Review The Portfolios generated positive absolute performance but trailed their benchmark in the fourth quarter, as notable strength in financials and energy, along with contributions from select health care holdings, were offset by weakness in materials and consumer discretionary. Beneath the surface, market leadership remained uneven. The quarter began with a continuation of one of the most extreme low-quality rallies on record, as non-earners, low-return on equity companies and high-beta stocks dramatically outperformed, leaving active managers broadly behind. This dynamic briefly gave way to a more constructive environment, as leadership rotated toward value, quality and lower-beta stocks, allowing small caps and active strategies to outperform for a short period. That improvement ultimately proved fleeting, as momentum leadership reasserted itself into year-end, closing the quarter with narrow breadth and elevated speculative activity. Financials strength...