It was supposed to be a quiet glide into the long Martin Luther King Jr. Day weekend. Instead, the market decided to get weird. While the big-name chipmakers were busy high-fiving over AI demand, a massive trapdoor opened under a few specific corners of the market. Honestly, if you were holding energy or software today, Friday, January 16, 2026, was basically a punch to the gut.
We saw the S&P 500 and the Nasdaq barely move—slipping less than 0.1% each—but that's the thing about averages. They hide the carnage. Beneath that calm surface, the biggest stock losers today were getting absolutely wrecked by a mix of political pivots from Washington and a "valuation reality check" in the tech world.
The Utility Meltdown: Why Power Stocks Got Short-Circuited
The biggest shocker of the day came from the utility sector. Usually, these are the "boring" stocks people buy for safety. Not today. Constellation Energy (CEG) and Vistra Corp. (VST), two of the hottest names of the last year thanks to the AI data center boom, saw their charts fall off a cliff.
Constellation shed nearly 10%, while Vistra dropped about 8%.
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What happened? Basically, the Trump administration dropped a bombshell. Reports started circulating that the White House is planning a major shake-up of the U.S. electricity grid. The goal is to force big tech companies—the ones building those massive AI data centers—to foot more of the bill for surging power costs to protect regular consumers. For investors who bet that utility companies would have an endless, high-margin revenue stream from Big Tech, this news felt like someone pulled the plug.
Software’s "Oversold" Crisis
Then there's the software group. While companies like Taiwan Semiconductor (TSM) and Micron (MU) are basking in the glory of hardware demand, the companies that actually make the apps are catching zero love.
We saw significant drops across the board:
- Atlassian (TEAM) fell over 6%, continuing a brutal weekly trend that has seen it lose nearly 20% of its value.
- HubSpot (HUBS) and Wix.com (WIX) followed suit, with HubSpot trading at a staggering 49% discount to what analysts at Morningstar consider its "fair value."
- AppLovin (APP) and Workday (WDAY) were also among the S&P 500's worst performers.
Katie Turnquist, a prominent market analyst, noted in a report today that the "software-to-semis ratio" is now reaching levels we haven't seen since the early 2000s. Investors are terrified that AI-native competitors are going to eat the lunch of established software giants. It’s a classic case of the market picking winners (the shovels) and dumping the perceived losers (the people using the shovels).
The Fed Chair Drama and the "Long Weekend" Slump
You can't talk about today's losers without mentioning the "Kevin Hassett Factor." Stocks were already feeling jittery because the 10-year Treasury yield climbed to a four-month high of 4.23%. High yields are like kryptonite for growth stocks.
The mood soured further when President Trump hinted he might keep Kevin Hassett in his current advisory role rather than nominating him to replace Jerome Powell as Fed Chair in May. The market had basically priced in a Hassett chairmanship as a guarantee of aggressive rate cuts. When that certainty evaporated, so did the bids for sensitive stocks in the financial and real estate sectors. Regions Financial (RF), for instance, slipped 3% after some disappointing guidance and general unease about the interest rate path.
A Quick Look at the Damage
| Ticker | Company | Percent Drop | The "Why" Behind It |
|---|---|---|---|
| CEG | Constellation Energy | -9.8% | Grid policy uncertainty |
| TCOM | Trip.com | -18.4% | Antitrust probe in Asia |
| VST | Vistra Corp. | -7.5% | Regulatory fears |
| AMCR | Amcor PLC | -7.3% | Broad industrial sell-off |
| TEAM | Atlassian | -6.6% | Software sector rotation |
What Most People Get Wrong About These Drops
When you see a stock like Constellation Energy drop 10% in a single day, the gut reaction is to think the company is broken. But look at the nuance. These companies are still the backbone of the AI buildout. The sell-off today wasn't about a lack of demand for power; it was about political risk.
The market hates uncertainty more than it hates bad news. The prospect of the government meddling in private energy deals between utilities and tech giants like Microsoft or Google is a variable that wasn't in anyone's spreadsheet yesterday.
Similarly, the drubbing in software is starting to look like a "babies and bathwater" situation. When Atlassian trades at a 44% discount to fair value, you have to ask yourself: Is the business really 44% less valuable than it was a few months ago, or is this just a temporary fever in the market?
Actionable Insights for Your Portfolio
So, what do you do with this? If you're staring at a sea of red in your brokerage account, here's the game plan:
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- Check the "Why": If your stock is down because of a broad sector move (like software today), it’s often a waiting game. If it's down because of a fundamental shift in government policy (like the utilities), you need to re-evaluate your price targets.
- Watch the 10-Year Yield: If that yield keeps creeping toward 4.5%, the pressure on the biggest stock losers today isn't going to let up.
- The 48-Hour Rule: Never make a major trade on the Friday before a long weekend when liquidity is thin. Let the news settle. See how the market opens on Tuesday.
- Look for Disconnects: Analysts are pointing to software being "historically oversold." For a long-term investor, these "bloodbath" days are often the best time to nibble on quality companies that are being punished for being in the wrong zip code.
The reality of the 2026 market is that it’s fast, it’s headline-driven, and it's increasingly decoupled. One sector can be at a party while the other is at a funeral. Today, the energy and software sectors were definitely at the funeral.