Sell America: Why CIOs should examine the recent market selloff

In the early weeks of 2026, a "Sell America" stock selloff emerged, as investors began to dump U.S. stocks, bonds and the dollar. The pullback from American assets followed escalating geopolitical tensions and policy uncertainty. 

Unlike a routine stock market correction, the selloff reflects declining confidence in U.S. policy predictability rather than company-specific performance.   

The pattern stands out because it hits stocks, bonds and the dollar simultaneously, indicating broad concerns about U.S. economic policy. The Sell America stance matters for technology leaders because markets react to risks before they surface in enterprise technology budgets and strategy discussions. 

"Market volatility is rarely just a Wall Street problem," said Chris Campbell, CIO at DeVry. "It's an early signal that the assumptions underneath our technology roadmaps may be shifting." 

What Is the Sell America trade — and why is it back? 

The Sell America trade means that investors are reducing exposure to U.S. assets amid policy, trade and geopolitical uncertainty.  

The pattern first emerged in April 2025 and has recurred multiple times since, triggered by tariff announcements, Federal Reserve independence concerns and geopolitical tensions related to Greenland and Venezuela. 

There is a connection between the Sell America phenomenon and technology budgets, representing macroeconomic risk for CIOs. There are several ways that financial markets directly affect the ability of enterprises to maintain planned technology spending, including capital availability, shareholder value protection and business sentiment, according to Stephen Minton, group vice president of data and analytics at IDC.  

"Market volatility has an impact on borrowing costs, which makes projects more difficult to finance," Minton said. "IT budgets can receive new levels of scrutiny, resulting in delays to capital spending and/or operating spend." 

Why this matters to CIOs -- not just CFOs 

The economic impact of the market volatility related to the Sell America trade matters to CIOs for a number of critical reasons: 

Capital tightening. Availability of capital might start as a CFO concern, but it also affects CIOs. CFOs are much more involved in tech decisions now, according to Yugal Joshi, partner at Everest Group.  

The focus often becomes capital preservation rather than investment, which can curtail the spend CIOs can get for their initiatives, he said. This may not happen immediately, but CIOs still need to plan for it.  

Budget scrutiny. As a result of the capital tightening there is also the potential for increased budget scrutiny. CIOs should expect to be asked for additional justification for their planned project spending and to provide more evidence of measurable outcomes, Minton said. 

"They may also face pressure to deliver cost savings through tactical measures such as sourcing at lower prices and through shorter contracts," he said. 

Board expectations. CIOs face increased scrutiny from boards and executive leadership during volatile periods, according to Campbell. When capital tightens and policy uncertainty rises, technology becomes one of the first areas leaders revisit, not because it's optional, but because it's visible.  

For CIOs, this moment is about pressure-testing priorities -- understanding which initiatives are truly strategic and which were funded in more stable conditions that may no longer exist.

"For CIOs, this moment is about pressure-testing priorities -- understanding which initiatives are truly strategic and which were funded in more stable conditions that may no longer exist," he said. "The risk isn't reacting too quickly, it's being surprised when budget, vendor or operating constraints suddenly change." 

Technology spending in a risk-off environment 

When market volatility signals economic uncertainty, technology budgeting volatility emerges as spending doesn't simply decrease. Instead, it shifts in predictable patterns. The focus moves from growth-focused investments to efficiency, resilience and value realization. 

Where technology spending is restricted: 

Device spending. End-user devices are among the first casualties of economic uncertainty, according to Minton. Businesses can save capital in the short-term by delaying upgrades to PCs, printers and other devices. 
 
"Right now, there's also less pent-up demand for device upgrades, coming off the back of a strong upgrade cycle in 2025 related to Windows 11," he said. "This means it's easier than it was 12 months ago for businesses to delay planned PC upgrades." 

Project services. Project-based IT services are also typically on the chopping block when it's time to tighten budgets. 

"Projects without a clear immediate ROI tend to be delayed or postponed, with OpEx receiving additional controls," said Minton. "Incremental spending on new projects is especially vulnerable, because it's very difficult for businesses to stop spending on core operational functions like cloud services which support the business and existing processes." 

Digital transformation. Larger efforts for digital transformation are also at risk of getting delayed in favor of projects that have more direct and immediate impact on the bottom line, according to Joshi. 
 
"The most focus is on continuing the business rather than transformation," he said.  "Therefore, managing systems for efficiency, stronger resiliency and automation becomes the top priority. However, investments in critical transformation also continue but peripheral transformations stop." 

Where technology spending will still grow: 

Cost optimization and ROI-driven projects. When budgets tighten, the need to demonstrate results is heightened. Spending might be reallocated to projects with faster, provable ROI or which focus on cost savings, resilience and optimization, Minton said. 

Cybersecurity and core systems. Certain investments maintain priority even during economic downturns. "Investments that protect the institution, improve resilience or directly increase productivity tend to rise in importance, especially cybersecurity, automation and core systems that support revenue and learners," Campbell said. 

Existing enterprise software and cloud services. There tends to be several resilient IT spending categories which include, enterprise software, cloud services and operational services, according to Minton. 

AI spending (with caveats). AI investments currently show immunity to budget cuts, according to Minton.  IDC's surveys indicate that AI spending is also currently relatively immune to spending cuts. However, the same surveys show that businesses are now demanding more measurable business outcomes, so this is a potential downside risk if those outcomes are not delivered in the next six to twelve months. 

Vendor, supply chain and global operations risk 

Market volatility creates ripple effects that go beyond just budgets and day-to-day IT operations. 

"Budget pressure is only part of the picture," Campbell said. "Volatility often exposes second-order risks like vendor instability, shifting supply chains, regulatory changes and currency exposure in global contracts." 

Vendor stability matters. With increased uncertainty, vendor stability is important, particularly for smaller providers that may have a greater risk for disruption due to pricing or delivery volatility, according to Minton.  

"Vendors that are struggling in the marketplace are more likely to introduce price increases in the near term, or to alter product roadmaps," he said. "This can also trigger M&A activity at lower valuations, which reduces buyer pricing power due to reduced competition." 

Supply chain disruption. Not all volatility signals require immediate action. Minton said that short-term supply chain volatility is usual and might not be a sign that major action is needed. However, a more critical sign would be major shortages in product availability, especially in specific geographic regions. 

Opportunity in crisis. While there are risks, there are also potential opportunities and economic pressure on vendors can create strategic openings for CIOs, according to Joshi.  

"This increases entropy in the system across vendor risk, innovation stagnation and fragility in the supply chain," he said. "But this also can make vendors more desperate and CIOs can exploit this to get funding for their initiatives." 

The signals CIOs should watch going forward 

Given the Sell America dynamics, there are certain signals that CIO should be watching for, although the challenge for technology leaders is distinguishing real signals from market noise, according to Campbell. 

Signals to monitor: 

Pattern recognition. It's important to identify patterns and look for the signals in the noise as single data points alone aren't necessarily indicators of a trend. 

"One headline doesn't require action, but when multiple indicators align -- like vendor layoffs, roadmap changes or contract tightening -- that's when CIOs need to lean in," Campbell said. "This is where strong governance and scenario planning matter -- knowing where you have flexibility, where you don't and how quickly you can adjust if conditions worsen." 

Time horizons.  Short-term fluctuations can obscure longer-term trends. 

"Similar to other metrics, short-term data volatility can be 'noise', so CIOs should look for trends over three to six months," Minton said. 

Policy changes. Not every announcement requires action, according to Minton. "It's usually prudent to wait until policies advance to an implementation phase, rather than reacting to every policy idea which is floated by governments, but the use of executive powers in the US has muddied this a little in recent times," he said. 

What CIOs Should Do Now: 

Rather than reacting defensively to market signals, CIOs should use this period to strengthen their strategic foundation. 

Strategic prioritization:  The issue for mission-driven institutions isn't market performance, but whether technology strategies continue to support continuity, trust and learner success in a changing environment, said Campbell.  

"That's why moments like this call for more intentional prioritization, clearer risk awareness and tighter alignment between technology decisions and institutional mission," he said. "It's not a retreat from transformation, but a more disciplined and resilient approach to it." 

Leadership evolution: This environment also demands a shift in how CIOs communicate and operate.  

"The CIO's role shifts from championing possibility to clearly articulating tradeoffs, impact and return," Campbell said. 

Sean Michael Kerner is an IT consultant, technology enthusiast and tinkerer. He has pulled Token Ring, configured NetWare and been known to compile his own Linux kernel. He consults with industry and media organizations on technology issues.