AI Stocks Plunge Amid Warnings from Tech Leaders
Stock prices linked to artificial intelligence took a significant hit in early Asian trading on Monday. This drop came after leading tech executives expressed concerns over the rapid pace of AI development and its potential dangers to society.
Dario Amodei, CEO of Anthropic, urged other AI companies to slow down their advancements. Both Elon Musk, head of xAI, and Sam Altman, CEO of OpenAI, supported this call, highlighting rising fears about the misuse of AI technologies. In a related note, Altman announced that OpenAI would postpone any plans for an initial public offering (IPO) this year due to safety issues.
Investors reacted strongly, with shares of OpenAI’s major investor, SoftBank, falling by as much as 13.2%. Other tech stocks were also impacted, with memory chipmaker Kioxia dropping 9.8% and Tokyo Electron declining by 3.7%.
In Taiwan, Taiwan Semiconductor Manufacturing Company saw a decrease of 1.2%, while in South Korea, SK Hynix dropped 5.3% and Samsung Electronics fell by 3.7%. Takayuki Miyajima, a senior economist at Sony Financial Group, pointed out that the weekend discussions on slowing AI development were putting pressure on AI and semiconductor stocks in Tokyo. He also noted ongoing uncertainty in the Middle East, which is affecting market sentiment.
In Shanghai, CXMT, another memory chip manufacturer, saw a decline of 2.7%, and Semiconductor Manufacturing International Corporation fell by 1.4%. In Hong Kong, Zhongji Innolight dropped 4.1%, and Minimax lost 5.4%. Shares of Z.ai, known for its GLM AI series, plummeted as much as 10.5% following news of a discounted share placement.
A recent report from Anthropic detailed alarming uses of its Claude AI models, from weapons development to cyber operations and surveillance. Fears about AI’s potential harm heightened when Anthropic researcher Jacob Coxon resigned, stating that those developing AI genuinely believe it could pose an existential threat within the decade. Altman echoed these concerns, describing the risk of human extinction from AI as “unacceptable.”
While many U.S. lawmakers are calling for new regulations due to AI’s rapid growth, former President Donald Trump dismissed their worries, suggesting they are overblown. He emphasized the need for the U.S. to maintain its leadership in the industry.
Since the launch of ChatGPT in 2022, AI-related investments have driven much of the growth in global markets. However, recent cyberattacks from rogue AI entities and public opposition to data center construction are raising questions about the future of AI development.
This month, the U.S. and China are scheduled to have discussions regarding AI safety, highlighting the global recognition of this pressing issue.
