US stocks on course for lower open as AI jitters hit Nvidia, chipmakers

Anthropic CEO Dario Amodei on Saturday called on artificial intelligence companies to slow the pace at which they advance model capabilities. Elon Musk, who runs xAI, and OpenAI CEO Sam Altman said they agreed with Amodei. The losses reflect waning exuberance after a frenzied race to develop increasingly capable AI models gives way to a sober reassessment. Billions of dollars poured into AI have powered a stratospheric rise in some technology and semiconductor stocks and were critical to strong equity market gains over the past few years. At 08:26 a.m. ET, Dow E-minis fell 223 points, or 0.42%, S&P 500 E-minis dropped 51.25 points, or 0.67%, and Nasdaq 100 E-minis lost 477.5 points, or 1.62%. Chipmakers declined, with Intel, AMD and Marvell Technology down 6.5%, 5.5% and 7.5%, respectively. Some investors were unsure if the pullback would last, given the lack of consensus on what the slowdown Amodei spoke for would look like. A slower pace of AI development could, however, potentially reduce the need for heavy spending on the technology. "This is probably more of a hiccup for AI stocks as opposed to an eye-opener," said Dennis Dick, founder and market structure analyst at Triple D Trading. Shares of software stocks, which have been dampened by concerns that AI could disrupt their businesses, climbed. ServiceNow, Adobe and Workday were up 4.7%, 2.3% and 2.3%, respectively. Meta rose more than 2% and Alphabet climbed 1%. Concerns about the potential harms of AI intensified when Anthropic researcher Jacob Coxon resigned last week and said the "people building AI earnestly believe that it could kill us all by the end of the decade." However, some investors urged skepticism about the doomsday pronouncements. Michael Burry, known for his successful bets against the U.S. housing market in 2008, posted on X that the warnings were an attempt by major players to stifle smaller competitors. Annex Wealth Management Chief Economic Strategist Brian Jacobsen also questioned if the statements were credible. "The strongest arguments for caution are those grounded in evidence, not fear. We should be wary both of incumbent firms seeking to protect their position and of confident predictions about outcomes that no one can reliably quantify," Jacobsen said. But the setback in equities could set the tone for markets ahead of a potential interest-rate hike later in the week, with traders pricing in a nearly 89% chance of a rate increase by the U.S. Federal Reserve, according to CME's FedWatch. Sentiment was already weakened after data last week showed accelerating U.S. inflation. Oil prices are also trading at levels not seen since May. Brent crude futures rose more than 3% to $108.01 on Monday, while U.S. West Texas Intermediate crude futures advanced 3% to $103.01. Wall Street's main indexes were on track to open lower on Monday, weighed down by a selloff in big AI stocks after top U.S. executives cited safety risks and called for a slowdown in artificial-intelligence development. Shares of Nvidia, one of the main AI heavyweights, fell 2.5% in premarket trading, while "Magnificent Seven" peer Amazon lost about 1%.

US stocks on course for lower open as AI jitters hit Nvidia, chipmakers

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