What Happened?
Shares of financial services giant Charles Schwab (NYSE:SCHW) fell 6.9% in the afternoon session after the launch of a new artificial intelligence tool by financial software provider Altruist sparked concerns about disruption in the wealth management sector. The tech platform announced a new AI-powered tax planning tool, which triggered a selloff across several wealth management stocks. The news raised worries that artificial intelligence could upend the traditional business models of financial services firms. Other companies in the sector, including Raymond James Financial and Stifel Financial, also saw their stock prices fall as investors reacted to the potential competitive threat posed by new technology.
The stock market overreacts to news, and big price drops can present good opportunities to buy high-quality stocks. Is now the time to buy Charles Schwab? Access our full analysis report here, it’s free.
What Is The Market Telling Us
Charles Schwab’s shares are not very volatile and have only had 3 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 5 months ago when the stock dropped 5.8% on the news that a significantly weaker-than-expected U.S. jobs report sparked fears of an economic slowdown, dragging down the broader market and economically sensitive sectors like banking. The U.S. economy added only 22,000 jobs in August, falling far short of the estimated 75,000. This report from the labor market prompted a sell-off as investors weighed the possibility of a recession. The banking sector was particularly hard-hit, falling over 2% as concerns grew about the economy's health. While the soft labor market data could encourage the Federal Reserve to cut interest rates, the immediate market reaction was negative, with the potential for an economic downturn overshadowing optimism about looser monetary policy.
Charles Schwab is down 2.1% since the beginning of the year, but at $99.45 per share, it is still trading close to its 52-week high of $107.21 from February 2026. Investors who bought $1,000 worth of Charles Schwab’s shares 5 years ago would now be looking at an investment worth $1,785.
Do you want to know what moves the business you care about? Add them to your StockStory watchlist and every time a stock significantly moves, we provide you with a timely explanation straight to your inbox. It’s free and will only take you a second.