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The information provided on EL7.AI is for educational and informational purposes only and does not constitute financial advice.
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Sign InFinancial markets are witnessing a significant shift in investor sentiment as AI companies begin rationing compute power due to high costs and resource scarcity. This trend has redirected capital flows toward traditional software firms with established business models. Consequently, the iShares Expanded Tech-Software Sector ETF (IGV) recorded its best weekly performance in 25 years, signaling a major rotation in market leadership. Analysts suggest that the scarcity of AI infrastructure is currently acting as a tailwind for established software giants like Microsoft and Oracle. This sectoral rotation marks a new phase in the IT cycle, shifting focus from pure infrastructure to software applications. This momentum is expected to persist as long as cloud computing costs remain a primary challenge for emerging AI ventures.