US Equity Markets Bounce Back Amid AI Slowdown Concerns
US equity markets opened lower on Monday following proposals from AI leaders to slow down technology development. Oil prices rebounded, causing concerns among investors. The Nasdaq dropped by 0.56%, the S&P 500 fell by 0.48%, and the Dow Jones Industrial Average decreased by 0.29%. However, indices pared their losses throughout the session and finished near unchanged levels.
Some of the biggest losers were AI-related companies. The PHLX Semiconductor Index (SOX) dropped by 5.9%. In contrast, other areas such as software, cybersecurity, and hyperscalers saw gains. Alphabet (GOOG) and Meta (META) led the way in hyperscaler performance.
President Donald Trump reacted to the slowdown proposal, calling it a 'SICK conspiracy.' He claimed that China would be the only beneficiary of slower AI development, stating that a 'strong and smart' president is all the guardrails needed. However, Trump's comments did little to ease investors' concerns.