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Software stocks like Snowflake and Datadog drop sharply amid sector rotation before earnings.

Market News
02 Sep 2026, 19:41 WIB
24/7 Wall Street
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Bearish
Software stocks like Snowflake and Datadog drop sharply amid sector rotation before earnings.

Leading software stocks Snowflake, Datadog, and Cloudflare fell 4-6% as investors rotated out of high-multiple software names despite the broader tech index remaining stable. Snowflake's earnings report due after market close is coincidental to the selloff, which reflects profit-taking rather than a fundamental shift in the AI-driven software sector. The software ETF IGV dropped 3%, highlighting targeted selling within software rather than a tech-wide decline. Investors should watch Snowflake's report for cues on the sector's near-term direction.

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