Meta's new AI product, Muse, has created notable market turbulence, particularly affecting Charles Schwab and Robinhood. Schwab's shares fell 6% to their lowest point since early July, marking an 8% decline since the announcement of Muse. In contrast, Robinhood's stock rose, reaching a year-to-date high, as the company had previously launched AI agents capable of trading and managing portfolios.
Other financial firms like LPL Financial Holdings and Raymond James also experienced declines, with LPL down 7% and Raymond James down 3.5%. The State Street Financial Select Sector SPDR ETF (XLF) lost 2%, reflecting broader sector concerns.
Analysts suggest that AI innovations threaten traditional financial intermediaries, with Schwab's reliance on low-yield cash making it particularly vulnerable. Options trading data indicates a bearish sentiment towards Schwab, with a significant volume of put options being purchased, while Robinhood saw a bullish trend with more call options being traded.
This shift in investor sentiment underscores the growing appeal of platforms like Robinhood among younger investors, as they adapt quickly to new technologies and rebuild trust following past controversies