Canadian Tech Stocks Set For Worst Quarter Since 2022 on AI, War

Canadian tech stocks are facing their worst quarter since 2022, with steep declines driven by AI disruption fears and geopolitical instability, particularly the Middle East conflict. The software-heavy sector is bearing the brunt, as investors pivot away from tech amid concerns over AI’s rapid advancement displacing traditional software models. Capital is shifting to energy stocks, viewed as safer bets amid escalating regional tensions, further draining tech sector investments. This downturn marks a sharp reversal from recent growth, highlighting vulnerabilities in Canada’s tech ecosystem to external shocks like war and technological upheaval. Analysts warn prolonged instability could delay recovery, with AI’s economic impact and conflict-driven market shifts reshaping investment strategies through mid-2026.