Leading figures in artificial intelligence—Dario Amodei of Anthropic, OpenAI’s Sam Altman, Elon Musk of xAI, and Demis Hassabis from Google’s DeepMind—have recently called for a slowdown in AI development amid growing concerns about the technology’s potential risks. Despite these warnings, investor enthusiasm for AI-related stocks persisted, with shares of major technology companies advancing at the start of the trading week.
On Monday, shares of Microsoft, Alphabet, and Meta Platforms—influential players often referred to as "AI hyperscalers"—gained more than 2 percent. This boost came alongside a rotation in the market away from semiconductor chip makers, such as Micron Technology and Intel, toward these firms that rely on AI-driven data centers. Investors appeared to bet that even if AI progress were to decelerate following calls for caution, these hyperscalers would remain among the most profitable companies globally. Semiconductor manufacturers, however, are more dependent on sustained new orders to maintain growth momentum.
The market reaction occurred amid heightened public debate over AI risks. Former US President Donald Trump reacted skeptically to the concerns raised by AI pioneers. He described what he called a "SICK conspiracy" targeting AI and data centers, warning that "China" stood to benefit from any slowdown. Later that day, Trump spoke to Nvidia CEO Jensen Huang during a technology conference in Los Angeles, refuting fears that AI or robots would "take over." Huang reportedly agreed, responding, “That’s right, we’re not going to let that happen, sir.”
Despite these discussions and the muted gains in AI stocks, the overall US stock market saw modest declines on Monday. The S&P 500 fell 0.5 percent, the tech-focused Nasdaq Composite slipped 0.6 percent, and the Dow Jones Industrial Average ended down 0.3 percent, or 152 points. Semiconductor stocks bore the brunt of selling pressure, with the PHLX Semiconductor Index dropping 5.9 percent, marking its worst day since July. Conversely, cybersecurity firms experienced notable gains.
Market analysts interpreted recent developments as signaling a key turning point for AI, with an emphasis on balancing innovation and safety amid increased volatility. Art Hogan, chief market strategist at B. Riley Wealth, described the situation as an "inflection point" likely to enhance safety in the long term, even if it causes short-term market fluctuations. Meanwhile, some investors remain confident in AI’s growth potential. Giuseppe Sette, co-founder of AI analytics firm Reflexivity, noted that despite widespread concern from industry leaders, competition with China is expected to prevent any significant slowdown in AI advancement. He added that recent stock price dips in AI companies present buying opportunities rather than reasons for retreat.
As the debate continues, the AI sector remains a major driver of US market activity, reflecting both the promise and the uncertainty surrounding this rapidly evolving technology.