Global AI stocks decline as top industry leaders urge for deceleration of progress
The decline comes as billions of dollars continue to be invested in the sector, which has helped drive global markets to unprecedented levels in recent years
Shares of companies associated with artificial intelligence (AI) fell sharply across global markets on Monday, following warnings from leaders of several AI firms about the risks associated with the technology’s rapid advancement.
The decline comes as billions of dollars continue to be invested in the sector, which has helped drive global markets to unprecedented levels in recent years.
Futures tracking Wall Street’s Nasdaq e-mini futures fell 1.9 per cent, amid a sharp decline in chip stocks that have fuelled the AI frenzy.
Among leading stocks, Nvidia fell 3 per cent, Advanced Micro Devices declined 5.7 per cent, while Elon Musk’s SpaceX slipped 2.6 per cent. Other major companies, including Meta and Amazon.com, fell more than 1.4 per cent each.
European technology stocks also fell 2.5 per cent, led by a 5.8 per cent decline in shares of chip-equipment maker ASML. Chip manufacturer Infineon fell 8.4 per cent, while AI equipment producer Siemens Energy declined 7.4 per cent.
The trend was similar in Asia, with OpenAI investor SoftBank falling 13.2 per cent, Taiwan Semiconductor Manufacturing Company declining 1.2 per cent and South Korea’s SK Hynix dropping 6.3 per cent.
The sell-off followed concerns raised by executives from several AI firms about the risks associated with the technology’s rapid advancement.
In an extensive article posted on X on Saturday, Anthropic CEO Dario Amodei called on AI firms to slow the pace of advancements in their models amid growing concerns over the potential misuse of AI.
Subsequently, Elon Musk, head of xAI, and Sam Altman, CEO of OpenAI, backed Amodei’s call and expressed agreement with his concerns.
The development has raised questions over whether the massive investments in AI infrastructure can be sustained if the pace of technological advancement slows.
Experts believe that if the pace of AI development slows significantly, the key question will be who will bear the costs of the infrastructure already being built. Lease payments, debt obligations and power costs will continue regardless of a decline in anticipated computing demand and revenue growth.
This could gradually introduce greater credit risk into the AI investment narrative. AI-linked stocks have driven a significant portion of global stock market gains since OpenAI launched ChatGPT in 2022.
