[Chart] sunset or silver-lining?

Software Sector +thoughts on Korean equities, Agri commodities, and Value vs Growth...

Jul 15, 2026

Note: this is a new series for free subscribers and is intended to give an insight into the work that goes on at Topdown Charts (+deliver some useful and timely takeaways).

Chart in Focus: Software Relative Value

Once prized for their repeatable reliable cashflows and solid pace of growth, software stocks have gone from trading at a major Premium —to now a material Discount vs the rest of tech.

The market has jumped to the conclusion that software is a sunset industry in the AI-age (given AI makes coding easier, and has made some software applications obsolete; increasing the pace of disruption). And as we can see in the chart below, relative-valuations have reflected that sentiment almost overnight.

But when I see charts like this I think: that’s an extreme, and extremes can be a great source of opportunity.

+when I hear the grim prognosis for software I think: wait a minute, if AI is really that useful then why can’t software companies use it? Why can’t they roll out AI-integrations to their existing customer base? Why can’t they achieve greater efficiency and impact by using AI in their business? …and also, on the barriers to entry falling —can new Startups vibe-coding new software really actually compete with the powerful brand and distribution edge that existing software incumbents hold?

Software Sector — What do you think?

(what’s your core-view/how are you positioned?)

Weekly Report Highlights

Here’s the topics & takeaways from my latest report —it should give a good sense of what I tend to cover in the Topdown Pro service as well as providing some high-level insights into how I am currently seeing Macro & Markets:

1. Korean Equities: Korean equities are at risk after a near vertical run (extreme expensive valuations) particularly as policy is about to pivot to rate hikes, and having made an initial breakdown.

2. Software Sector: remain bullish on software stocks given bullish technicals, major reset in valuations, and still solid earnings outlook despite worst AI fears.

3. Agri Commodities: continue to see upside risk for agri commodities as a group due to cheap valuations, light capex, improving sentiment, weather risk, and bullish technicals.

4. Value vs Growth: reluctantly bullish on value vs growth given the extremes in valuations, wild sector skews and investor crowding into growth vs value, but mindful that the technicals are not supportive yet.

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Best wishes,
Callum Thomas

Founder & Head of Research at Topdown Charts

LinkedIn: https://www.linkedin.com/in/callum-thomas-4990063/
Twitter/X: https://twitter.com/Callum_Thomas