Software stocks just passed a big milestone

Could it be "SaaSpocalypse Never?" Software stocks are surging back from an artificial intelligence-driven sell-off that saw the group shed almost 40% from highs last year, rallying about 6% Monday in a surge that brought the year-to-date performance in the iShares Expanded Tech-Software Sector ETF (IGV) into positive territory for the first time. The fund is now less than 9% below its all-time high from September after a 44% rally off its April low. Cybersecurity stocks are leading the charge, with the Amplify Cybersecurity ETF (HACK) now up more than 30% on the year on the back of gains in companies like CrowdStrike and Palo Alto Networks , up 67% and 63% in 2026, respectively. "AI equals more cybersecurity demand as there is more to secure," said Christian Magoon, CEO of Amplify ETFs, which owns HACK. "We think this also plays into M&A potential for the industry." Soaring prices are rewarding options traders who had been leaning into the comeback for weeks, pivoting as early as mid-May from the VanEck Semiconductor ETF (SMH) to IGV, where call volumes started outpacing puts. That trend continued Monday as the number of calls traded more than doubled puts, compared to in SMH, where put volume was three times that of calls. In the IGV, about twice as many calls were bought than sold. …