AI Sector Tested, US Stocks Retreat
US stock markets weakened on Friday (July 17th), dragged down by growing concerns about the massive spending in the artificial intelligence (AI) sector. This sentiment weighed on global technology stocks, particularly semiconductor companies.
The Nasdaq Composite fell 1.8% as tech stocks came under pressure. The Dow Jones Industrial Average fell 519 points, or 1%, while the S&P 500 declined 1.2%.
The greatest pressure came from chip stocks. The iShares Semiconductor ETF and the VanEck Semiconductor ETF both fell more than 3%. Applied Materials and LAM Research shares fell around 5%, while Intel, KLA Corporation, and Arm all fell around 4%.
Other major stocks, such as Micron, also fell more than 2%, while Nvidia fell more than 3%. This decline extended the pressure that had already occurred in the previous session, when the semiconductor sector was also a major market drag.
Sentiment was further depressed after Chinese startup Moonshot AI introduced a new AI model that it claims is approaching the capabilities of flagship products from the United States. This has sparked renewed concerns that AI competition is intensifying, while technology stock valuations are already quite high.
As a result, pressure on chip stocks has the potential to make investors more cautious about the technology and AI sectors. If concerns about AI spending continue to mount, technology-based indices like the Nasdaq are at risk of further pressure. (arl)
Source: Newsmaker.id
