On Monday, US equities displayed a stark divide after Dario Amodei, chief executive of Anthropic, urged a pause in the development of advanced artificial-intelligence models. Shares of chip manufacturers fell sharply, while the largest cloud-computing firms rose.
What happened on the trading floor?
Shares of Nvidia dropped more than 3% in early trading. Intel, AMD and Marvell each slid between 5% and 6%, pulling the Philadelphia Semiconductor Index down almost 6%. At the same time, the two biggest spenders on data-centre capacity, Alphabet (Google) and Microsoft, climbed roughly 2% and 1.6% respectively. Meta added about 1.4%, while Amazon slipped 1.6% but outperformed the chip makers.
Why the split matters
The market reaction reflects a growing awareness that a slowdown in AI research could reshape capital allocation across the tech sector. Gil Luria, head of technology research at D.A. Davidson, warned that a pause would hurt companies that sell the hardware and software "picks and shovels" of the AI boom more than the hyperscalers that buy the capacity.
"They'll just all stop building data centres and just digest what they have," Luria said.
Luria likened the scenario to Amazon's post-pandemic reduction in warehouse construction, which boosted cash flow because the company continued to use existing space. If AI progress slows, hyperscalers could keep revenue while cutting capital expenditures, improving profitability.
What could happen next?
Analyst Dan Ives argued on X that investors should look beyond the headline, noting that a temporary slowdown would give software developers and model creators time to close the performance gap. He also pointed out that Chinese AI labs remain active, with Z.AI raising $5 billion over the weekend, according to Reuters.
Luria remains skeptical that any formal moratorium will materialise, saying the labs have not announced a concrete pause and that the AI race is likely to continue until all participants agree to halt.
Beyond AI concerns, markets are also reacting to higher oil prices, a 10-year Treasury yield that briefly hit 5%, and expectations of another Federal Reserve rate hike this week, adding further pressure on risk-on assets.