AI Scare Back in the Market: ETFs That Stayed Steady

Date context: Market moves referenced in this story center on February 23, 2026, when “AI disruption” fears re-emerged and triggered a sharp risk-off session across several high-profile stocks and sectors.

What Happened: The “AI Scare” Returns and Markets Flinch

On February 23, 2026, investors were jolted by a renewed wave of anxiety about how fast artificial intelligence could disrupt established business models—especially in software, payments, and platform-style companies. The fear wasn’t just abstract. It showed up immediately in price action: several well-known companies dropped hard in a single session, and major U.S. index ETFs slid alongside them.

One of the biggest shockers was International Business Machines (IBM). According to market reporting cited by Bloomberg and relayed in the syndicated coverage, IBM suffered its steepest decline in roughly 25 years, falling 13.2% on February 23, 2026. That’s the kind of move that makes even long-time investors sit up straight, because it signals not just “bad news,” but a broad shift in how the market is pricing future risk.

The index-level damage was meaningful too. The SPDR Dow Jones Industrial Average ETF Trust (DIA) fell about 1.6%, the SPDR S&P 500 ETF Trust (SPY) retreated around 1%, and the Invesco QQQ Trust (QQQ) slid more than 1.2%. In other words: this wasn’t a tiny dip in one corner of the market—risk sentiment softened across the board.

What Sparked the Selloff: A Bearish Report, Plus a Very Specific Tech Trigger

So why did the market react so sharply? The catalyst described in the report was a bearish note from Citrini Research, released over the weekend, that highlighted how AI could pressure several industries. The report’s central idea wasn’t “AI is coming someday.” It was more pointed: AI tools may lower barriers to entry, reduce switching costs, and eventually squeeze profit pools that looked stable for years.

Then came an extra dose of worry tied to IBM specifically. AI company Anthropic published a blog post on February 23, 2026 saying that its Claude Code tool can help modernize COBOL, a legacy programming language that remains widely used in older enterprise systems (including many environments historically associated with IBM). Investors interpreted this as a potential threat vector: if modernization becomes cheaper and faster, it could change the economics of long-running enterprise technology stacks. That helped intensify the selling pressure on IBM shares.

Who Else Got Hit: From Delivery Apps to Payments to Alternative Asset Managers

Once the market’s fear switch flipped, the selling spread. The report highlighted multiple companies that fell at least 6% during the session, including DoorDash, American Express, KKR, and Blackstone. Other names mentioned as falling sharply included Uber, Mastercard, Visa, Capital One, and Apollo Global Management. That mix matters because it shows the fear wasn’t limited to “pure tech.” It extended into financial rails, consumer payments, and even financial services business models that depend on information processing and fees.

Why “AI Disruption Fear” Can Move Stocks So Fast

Markets don’t just price today’s earnings—they price expectations about future cash flows, competition, and risk. When investors suddenly believe that AI could lower costs for new entrants or automate away high-margin services, they may decide that yesterday’s “moat” looks less like a castle wall and more like a picket fence.

The report also referenced comments attributed to risk analyst Nassim Nicholas Taleb, warning that markets may be underestimating structural risks tied to the AI boom—and that software could experience higher volatility and, in extreme cases, even bankruptcies. Whether or not you agree with that level of severity, the key point is this: once investors start thinking in “structural change” terms, valuation multiples can compress quickly.

Another scenario described was especially unsettling for investors in platform-heavy industries: the idea that AI could enable cheaper “vibe-coded” alternatives to dominant delivery platforms. It also suggested AI agents might help consumers route around certain transaction fees charged by payment processors like Mastercard and Visa. These aren’t forecasts carved in stone—but they illustrate the kind of narrative that can push markets to re-rate entire sectors in a hurry.

The Twist: While Many Stocks Fell, Some ETFs Stayed Steady (or Rose)

Even on ugly days, the market is never one single story. While broad indexes declined on February 23, 2026, several exchange-traded funds actually gained. The common thread? They were either linked to forces mostly unrelated to AI disruption (like energy and shipping), tied to a separate 2026 leadership theme (biotech), or built specifically to benefit from market declines (bear/short strategies).

Below are the ETFs highlighted as “steady” performers during that session, along with a deeper, plain-English explanation of what they are, why they moved, and what investors should keep in mind.

ETF #1 (Energy): VanEck Oil Services ETF (OIH)

What it did during the AI scare

The VanEck Oil Services ETF (OIH) rose about 0.8% on February 23, 2026 and gained around 2.8% over the prior week, according to the market recap. The explanation offered was simple: energy held up because oil prices had been rallying, supported by geopolitical tension—specifically U.S.–Iran tensions cited as a driver behind stronger oil prices.

What OIH actually is (in plain terms)

OIH is an ETF designed to track the performance of U.S.-listed oil services companies—businesses that help drillers and producers do the work of finding, extracting, and servicing oil and gas wells. Think of this slice of the energy world as “the picks-and-shovels” segment for exploration and production.

Costs and basics

OIH’s expense ratio is commonly listed at 0.35%.

Why it can be resilient when tech is shaky

Oil services returns tend to be driven more by energy prices, drilling activity, and capital spending cycles than by software disruption narratives. On days when “AI fear” punishes valuation-heavy sectors, energy can sometimes act like a different universe—especially if crude prices are rising for reasons like geopolitics, supply constraints, or demand surprises.

Key risks to know

Energy volatility: Oil services can swing sharply when crude prices fall or when drilling budgets get cut.

Cycle sensitivity: If energy producers reduce capex, oil services names can feel it fast.

Geopolitical whiplash: The same tensions that lift prices can also create sudden reversals if headlines change.

ETF #2 (Shipping): Breakwave Tanker Shipping ETF (BWET)

What it did during the AI scare

The Breakwave Tanker Shipping ETF (BWET) jumped about 6% on February 23, 2026. The reason cited was strength in crude oil tanker shipping, supported by higher freight rates linked to trade-route disruptions—especially issues around the Red Sea that can force ships to take longer, more expensive routes.

What BWET is (and why it’s different from typical stock ETFs)

BWET is designed to provide exposure to crude oil tanker shipping economics. Instead of being a “normal” equity sector ETF, it’s tied to an index focused on tanker freight markets—so its behavior can be very different from broad stock indexes. In real life, that means BWET can pop when freight rates spike, even if the Nasdaq is having a rough day.

Fees and structure notes

BWET is known for a high expense ratio—commonly listed around 3.50%. That’s much higher than plain-vanilla index ETFs, so investors usually treat it as a tactical instrument rather than a forever-holding.

Why BWET can rise when markets fall

Freight rates can be driven by geopolitics, bottlenecks, sanctions, fleet capacity, and route disruptions—factors that may have little to do with AI narratives. If tankers must travel longer distances, available capacity tightens, and rates can rise. That can boost the type of exposure BWET aims to deliver, even during broader equity selloffs.

Key risks to know

Very high fees: The cost of holding can be meaningful over time.

Sharp swings: Freight-linked exposure can be extremely volatile.

Headline sensitivity: If trade disruptions ease, rates can fall quickly—and so can returns.

ETF #3 (Medical/Biotech): iShares Genomics Immunology and Healthcare ETF (IDNA)

What it did during the AI scare

The iShares Genomics Immunology and Healthcare ETF (IDNA) rose about 2.7% on February 23, 2026 and was described as up roughly 16% year-to-date at that point. The cited explanation: biotech stocks had been strong in 2026 thanks to positive clinical trial readouts, improved valuations, and supportive macro conditions—tailwinds that can help the sector even when tech gets rattled.

What IDNA focuses on

IDNA targets companies connected to genomics, immunology, and next-generation healthcare innovation—areas where catalysts are often driven by science milestones (trial results, approvals, partnerships) rather than enterprise software disruption fears.

Costs and key facts

IDNA’s expense ratio is listed at 0.47% on the issuer’s product page and fund materials.

Why biotech can behave differently from “AI-risk” sectors

Biotech’s biggest drivers often include pipeline progress, regulatory decisions, and medical demand—forces that don’t always move in sync with software or payments valuation narratives. Also, when investors rotate away from crowded tech trades, they sometimes seek “new leadership” areas with different catalysts. In 2026, the story described was that biotech had momentum and improving fundamentals, which helped lift a specialized healthcare ETF like IDNA.

Key risks to know

Clinical trial risk: Bad data can hurt individual holdings quickly.

Regulatory risk: Approvals, labeling, and policy can shift outcomes.

High dispersion: Winners and losers can diverge dramatically, even in the same niche.

ETF #4 (Bear/Short Strategy): AdvisorShares Ranger Equity Bear ETF (HDGE)

What it did during the AI scare

The AdvisorShares Ranger Equity Bear ETF (HDGE) gained about 2.39% on February 23, 2026. The logic is straightforward: when markets fall, strategies that benefit from declines—like short exposure—may rise.

What HDGE is designed to do

HDGE seeks capital appreciation through short sales of domestically traded equities. In plain English: it’s built to potentially profit when certain stocks drop. Unlike simple “index inverse” funds, HDGE is positioned as an actively managed short strategy focused on identifying short candidates.

Fees: read this carefully

HDGE’s published expenses can be high. The fund’s materials show a net expense ratio that has been listed around 3.62%, with an expense cap limitation also referenced in the documents. (Exact expense details can change over time, but the key takeaway is that this is not a low-cost index ETF.)

Why HDGE can be useful in scary markets

When broad indexes slide, investors sometimes want a hedge—something that may move in the opposite direction to reduce overall portfolio shock. A short-oriented ETF can serve that role. On February 23, 2026, with DIA, SPY, and QQQ all down, a bear strategy had a natural tailwind.

Key risks to know

Shorting is risky: If the market rises, short strategies can lose money—sometimes quickly.

Costs matter: High fees can be a headwind over time.

Timing risk: Hedges can be most valuable right before or during declines—but holding them too long can drag returns if markets trend upward.

Putting It Together: What These “Steady” ETFs Have in Common

Even though these funds sit in very different corners of the market, they share a practical similarity: they’re tied to drivers that weren’t directly at the center of the AI disruption panic.

OIH leaned on energy dynamics and oil price support.

BWET leaned on shipping-rate pressures influenced by global route disruptions.

IDNA leaned on biotech momentum and healthcare-specific catalysts.

HDGE leaned on the simple math of hedging: markets down, some short exposure up.

Broader Market Context: “AI Scare Trade” Isn’t Happening in a Vacuum

The February 23, 2026 selloff fits into a broader conversation playing out in markets: investors are debating who truly benefits from AI, who gets disrupted, and how quickly the disruption arrives. Some reporting has described a rotation away from AI-vulnerable “asset-light” business models into areas with heavy physical assets or different economic drivers.

At the same time, other market participants have pivoted toward “AI infrastructure” exposures—things AI needs in the physical world, like chips, data centers, and power. That’s a different trade, but it highlights the same underlying point: investors are actively reshuffling portfolios based on how they think AI changes competitive advantages.

Investor Takeaways: How to Read a One-Day Panic Without Overreacting

1) Separate “narrative shock” from “fundamental change”

A scary report can spark a fast selloff, but the long-term impact depends on execution, adoption curves, regulation, and customer behavior. Markets often swing between overconfidence and overfear. The smartest move is usually to slow down and ask: “What actually changes in the next 6–24 months?”

2) Diversification isn’t boring—it's useful

Days like February 23, 2026 are exactly why diversified exposure matters. When one theme gets hit (AI disruption fear), other themes can hold up (energy, shipping, biotech) because their drivers are different.

3) Tactical ETFs can help, but costs and volatility are real

BWET and HDGE can move sharply and carry high fees compared with plain index ETFs. They may be tools—sometimes powerful ones—but tools still need careful handling.

Mini FAQ (Quick Answers)

Q1: What was the main trigger of the February 23, 2026 selloff?

It was tied to renewed AI disruption fears, a bearish report from Citrini Research, and added concern after Anthropic discussed modernizing COBOL with its Claude Code tool—news that contributed to heavy selling in IBM and other impacted sectors.

Q2: How much did IBM fall, and why was it notable?

IBM fell about 13.2% on February 23, 2026, described as its steepest drop in about 25 years—an unusually large move for a mega-cap, which amplified market anxiety.

Q3: Which major index ETFs dropped that day?

DIA fell about 1.6%, SPY about 1%, and QQQ more than 1.2% in the same session.

Q4: Why did OIH rise when tech-related fears were rising?

OIH is tied to oil services, and the report cited an oil price rally linked to U.S.–Iran tensions—supporting energy resilience while tech was under pressure.

Q5: Why is BWET considered a “different beast” than most ETFs?

BWET is linked to tanker shipping economics and freight-rate dynamics, which can surge due to trade-route disruptions (like Red Sea rerouting) even when the stock market falls.

Q6: What should investors watch most with HDGE?

HDGE uses short selling and can be helpful as a hedge in down markets, but it carries meaningful risks and relatively high expenses, so it’s important to understand holding period, purpose, and cost drag.

Conclusion: A Scare, a Selloff, and a Reminder That Not All ETFs Move Together

The February 23, 2026 “AI scare” session was a vivid reminder that markets can reprice narratives quickly—especially when investors fear structural disruption. IBM’s sharp decline and the broad weakness in DIA, SPY, and QQQ showed how fast uncertainty can spread.

But the story also had a second lesson: not all corners of the market obey the same storyline. Energy-linked exposure (OIH), freight-rate dynamics (BWET), biotech momentum (IDNA), and short strategies (HDGE) helped certain ETFs stay steady—or even rise—when the broader tape turned red.

In markets, fear comes and goes. What lasts is a clear plan: knowing what you own, why you own it, and how it might behave when the next surprise headline hits.

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