Tech investors are shifting their attention from semiconductor stocks to software due to concerns over high valuations and potential trade war impacts.

President-elect Donald Trump's intentions to impose additional tariffs on China, Canada, and Mexico have unsettled the semiconductor sector. In contrast, software stocks are experiencing a surge as investors are attracted to their lower exposure to tariff-related risks.

The software market is expected to benefit from the ongoing momentum in artificial intelligence, which is transitioning from infrastructure investments to service-oriented applications. This shift reflects a broader trend among Wall Street traders as they reassess their portfolios in response to the evolving political landscape.