You may be aware that CrowdStrike has been an essential part of my personal stock portfolio for many months. This cybersecurity firm provided good profit, nearly doubling its market value since last autumn. However, today CrowdStrike's management had to accept its responsibility for its faulty update to trigger a "super weird happening" which will become "the largest IT outage in history", according to Troy Hunt, an Australian Microsoft Regional Director. As a matter of fact, millions of Windows-equipped laptops and PCs around the world were suddenly BSoD’ing (showing the so-called Blue Screen of Death). Surely, shares of CrowdStrike immediately plummeted (by nearly 15% at some moments of pre-market trading today), as soon as the Windows outage quickly disrupted a bulk of global services like Visa and MasterCard transactions or airports' automatic check-in systems damaging of a lot of lowcosters, broadcasters and even supermarkets.

One may find much more detailed information on the issue in newswires, so that I just limit myself here with a single line saying that the latest software update of CrowdStrike's Falcon Sensor (actually an antivirus platform) led to crashes on Windows hosts, including Azure clouds, related to Falcon. Lingering degradation impact for Microsoft 365 and other applications is here, yet there is a little doubt that CrowdStrike will simply come back to its previous version of Falcon for a while, to fix the problem in the course of the weekend or even before this Friday evening. Getting more time to test all of its new programming codes Microsoft is also unlikely to abandon its cooperation with now-not-almighty but still extremely powerful and experienced CrowdStrike in the future, exactly as most users cursing Windows are not going to stop using it forever.

Everyone likes to grumble, but the share price would probably recover, sooner than later. This week's wave of AI and chip-based stocks' correction with a sectoral rotation may worsen the situation to some extent, but not in a fatal way, I believe. Therefore, my choice is slightly reducing the volume in some of my other favourite stocks from the AI segment, like Broadcom, Oracle, Micron, to fix some of my big profits in Google and Amazon (thus, temporarily exit from some positions, with a thought of re-buying after two or three weeks). Not reducing my stake in Microsoft, for now, as it lost only 1.5% as a first response to the outage news today, thus drifting from almost $470 in early July to below $440, yet I don't think Microsoft correction would go well below $420, in the worst possible case. At the same time, I am going to purchase even more of CrowdStrike later today, probably just 30-40 minutes before today's regular session's closure, as market conditions and circumstances are giving a great price discount. In the worst scenario, the current downside move in CrowdStrike may reach a technical support area between $250 and $275 per share, which is clearly marked by lows of late December and mid-February (look at the chart). But most likely the price rebound will happen already on Monday or Tuesday.

Even Citigroup sceptical analysts, who recommended rotation from skyrocketing IT segment to smaller caps and broader markets to their customers earlier last week, said they foresee further S&P 500 upside during the second half of 2024, even though at a moderate pace vs the first half. Goldman Sachs sees a "risk of a setback in the summer" for the S&P 500, shifting to a "neutral stance across assets on a three-month horizon" but remaining "mildly pro-risk for 12 months', favouring overweight positions in equities. There can be a higher risk of a market correction rather than a bear market for the second half of the year, the group's letter said, given that "with only some [economy] growth slowdown, a healthy private sector and a buffer from central bank easing, equity drawdown risk should be limited".