The market sentiment is turning bearish due to AI advancements impacting various sectors. Tech stocks, particularly software and data companies, are experiencing significant sell-offs. Companies focused on AI development and related infrastructure are seeing increased scrutiny. The trend suggests a rotation out of tech and into more defensive sectors. There's an ongoing debate about the potential impact of AI on traditional industries and the future value of software companies, with some analysts predicting further downside. While some tech stocks are under pressure, the long-term growth narrative for AI and related technologies remains a key focus.