Citrini Research Report Rattles Markets as AI Fears Deepen Tech Sell-Off
By: Saskia Koopman, Tech Reporter
Tuesday 24 February 2026 1:56 pm
A speculative research note imagining a hypothetical AI-driven economic downturn triggered a sharp sell-off in US tech stocks on Monday, intensifying pressure already mounting from new artificial intelligence tools. The Dow Jones Industrial Average plummeted 821.9 points, representing a 1.7 percent decline, while the S&P 500 dropped 1 percent and the Nasdaq Composite slipped 1.1 percent.
Fictional Scenario Sparks Real Market Turmoil
The market tumble followed a widely circulated Substack post by New York-based Citrini Research titled 'The 2028 Global Intelligence Crisis.' Authored as a fictional market dispatch from June 2028 and explicitly described as a "scenario, not a prediction," the piece nevertheless spread rapidly across trading desks and social media over the weekend. This dissemination added to broader trade uncertainty and escalating concerns about the pace and impact of AI disruption, particularly in the wake of Anthropic's new AI tool released earlier this month.
Citrini's memo paints an unsettling future where rapid AI adoption leads to mass white-collar job losses, weakens consumer spending, and ultimately contributes to a 38 percent peak-to-trough fall in the S&P 500 from October 2026 highs. The scenario projects a US unemployment rate of 10.2 percent, more than double the 4.3 percent recorded last month.
The report warns that businesses relying on transaction fees or 'friction' could face significant margin pressure if AI agents reduce the need for third-party entities. It also suggests enterprise software costs might come under strain if AI coding tools enable companies to replicate features internally.
Targeted Companies Experience Sharp Declines
Several companies mentioned in Sunday's report saw their shares decline sharply on Monday. Payment giants Visa and Mastercard experienced notable drops, while delivery and ride-hailing platforms also fell. Private capital firms with substantial exposure to software-backed loans were pulled lower as well.
Reuters reported that private equity and private credit groups were caught in Monday's sell-off, reflecting ongoing concerns about AI's potential disruption to software revenues. The market reaction underscores how sensitive investors have become to automation effects, especially in sectors where pricing power depends on intermediation.
New AI Tools Compound Existing Pressure
The market movement wasn't driven solely by Citrini's note. On Monday, AI start-up Anthropic published another Claude tool designed to assist with COBOL, a legacy programming language still widely used in banking systems. According to the tech behemoth, COBOL continues to underpin significant portions of financial infrastructure, including the majority of American ATM transactions.
IBM, a major provider of mainframes and related services tied to COBOL systems, fell 13.2 percent following the announcement, marking its steepest one-day drop since 2000. Shares in consulting and IT services companies with exposure to legacy modernization work also declined during the same period.
This announcement followed a series of AI updates from Anthropic in recent weeks that have contributed to a major software sell-off. Analysts at UBS noted that coding has become "the first domain where AI demonstrably outperforms humans at scale," increasing pressure on specific segments of the software sector.
Broader Market Fragility Exacerbates Concerns
These AI-related concerns coincide with already volatile markets amid shifting US tariff policy, after Donald Trump moved to replace recently invalidated trade measures with new global tariffs under separate legal authority. Simultaneously, valuation metrics have drawn increased attention; the S&P 500's cyclically adjusted price-to-earnings ratio recently exceeded 40, a level reached only rarely in modern history.
In the UK, the House of Commons Treasury Committee recently warned that financial regulators risk falling behind rapid AI deployment in financial services and called for clearer accountability frameworks. Citrini's authors characterized their report as a mere "thought exercise" intended to explore potential risks from rapid AI progress, but the note's ability to move markets reveals deep-seated investor anxiety about automation's transformative effects.
