AI Safety Concerns Spark US Stock Market Decline
US stocks took a hit on Monday morning due to concerns over AI safety. The Dow Jones Industrial Average (^DJI) fell by just 0.1%, while the S&P 500 (^GSPC) declined by 0.3%. However, tech-heavy Nasdaq-100 (^IXIC) plummeted by 0.4% after two leading frontier artificial intelligence companies called for a slowdown in AI development. The move was sparked by a 3,800-word essay written by Dario Amodei, CEO of Anthropic (ANTH.PVT), arguing that AI companies should slow the pace of improving AI models to address safety concerns.
Sam Altman, CEO of rival AI lab OpenAI (OPAI.PVT), agreed with Amodei's stance in a post on X. This has put both companies at odds with Wall Street, which has been banking on rapid advancements in AI technology. As a result, tech stocks, including Nvidia (NVDA) and chip stocks, took a hit.
The 10-year Treasury yield breached the 5% threshold for the first time since 2023, adding pressure to stocks. Oil prices continued to rise due to the ongoing conflict in the Middle East and Saudi Arabia's shutdown of a key pipeline, with Brent crude (BZ=F) trading near $107 per barrel.