U.S stocks fall on talk of slowing A.I development

Wall Street stocks fell early Monday as a call from leading artificial intelligence executives to slow the technology weighed on chipmakers and other companies.

On Saturday, Anthropic CEO Dario Amodei advocated for a coordinated slowdown of AI development to better understand the risks, drawing support from other industry leaders.

While the warning was dismissed by US President Donald Trump, shares of Nvidia, AMD and CoreWeave were all lower Monday.

About 15 minutes into trading, the Dow Jones Industrial Average was down 0.2% at 52,458.24.

The broad-based S&P 500 fell 0.7% to 7,606.96, while the tech-rich Nasdaq Composite Index dropped 1.1% to 26,051.32.

“All of a sudden, out of nowhere, all the major CEOs of these AI companies said we have to slow down, because there’s a real threat that AI can get out of control,” said Adam Sarhan of 50 Park Investments.

The statement is worrisome because “the AI trade has been the engine of both the economy, and of the stock market over the last several years,” Sarhan said.

Markets are also looking ahead to Wednesday’s Federal Reserve decision, with markets overwhelmingly predicting a rate hike amid persistent inflation and elevated oil prices.

Further rattling markets, OpenAI CEO Sam Altman told Fortune magazine Saturday that his company would not be going public this year. “Given everything happening with safety, right now would be an ill-advised moment to go public,” he said.

OpenAI and Anthropic’s eventual public offerings are expected to be among the largest of all time.

“For markets, the key question is whether this is the first sign that the extraordinary AI investment cycle might eventually moderate,” said Jim Reid, Deutsche Bank global head of macro research. “For now, that seems unlikely. The competitive race between companies and countries remains intense, and it’s difficult to imagine firms voluntarily stepping back while rivals continue to push ahead.”

Overnight, worries about slowing the AI industry hit South Korea’s benchmark Kopsi index, which sharply fell more than 3%. That fall was primarily due to selling in AI memory firms. Samsung Electronics sold off by 5% and SK Hynix plunged more than 7.3%.

In Tokyo, shares of OpenAI investor SoftBank Group fell 10.7%.