NEW YORK: Wall Street’s main indexes fell on Monday, pummelled by a selloff in heavyweight AI stocks after top US executives raised safety concerns and called for slowing the development of artificial-intelligence capabilities.
Shares of Nvidia tumbled 3 percent, hitting their lowest level in nearly three weeks, while “Magnificent Seven” peer Amazon shed more than 1 percent.
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 as the frenzied race to develop increasingly capable AI models gives way to a clear-eyed 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.
“Three rivals now agree that the fastest engine in technology needs a governor. The market still has to learn how hard that governor will press,” said Matthew Tuttle, CEO of Tuttle Capital Management.
At 11:40 a.m. ET, the Dow Jones Industrial Average fell 123.22 points, or 0.23 percent, to 52,450.07, the S&P 500 lost 32.20 points, or 0.42 percent, to 7,624.78, and the Nasdaq Composite dropped 114.87 points, or 0.44 percent, to trade at 26,218.17.
The declines narrowed from earlier in the session, after US President Donald Trump said Iran wants to make a deal and that he would decide whether the United States would engage in the effort.
Chipmakers declined, with Intel, AMD and Marvell Technology down 5 percent, 5 percent and 6 percent, respectively.
The Philadelphia SE Semiconductor Index fell about 5 percent and was on track for its worst daily drop since July, if current losses hold.
Eight of the 11 major S&P 500 indexes traded lower, with industrials and technology leading declines.
Consumer staples and healthcare rose about 2 percent and 1 percent, respectively, as investors sought shelter in defensive areas of the market.
Shares of software stocks, which have been dampened by concerns AI could disrupt their businesses, climbed. ServiceNow, Adobe and Workday were up 7 percent, 4 percent and 5 percent, respectively.