From Investor's Business Daily · PAOLO CONFINO · · 1m 20s
Investors bail on AI, pile into old economy
A weekend of regulation talk sent AI money running toward the very industries AI was meant to replace.
In brief
A weekend of regulation talk sent AI money running toward the very industries AI was meant to replace. The AI trade can unwind on sentiment alone, and when it does, the money moves to the sectors AI was supposed to disrupt. Originally reported by Investor's Business Daily.
Money runs from AI
Investors are pulling cash out of AI names and putting it into the old-line industries everyone assumed AI would flatten.
“Investors are fleeing AI names in favor of the very industries AI was supposed to decimate.”
Monday extends the slide
The rotation out of AI stocks did not stop at the open. Monday carried on the selling that had already been building.
Nvidia and Broadcom tumble
The chip names at the center of the AI trade took the hit, with Nvidia and Broadcom both falling as the money moved out.
Leaders ask for rules
Over the weekend, industry leaders publicly called for more regulation of AI, a rare case of an industry lobbying to be reined in.
Too powerful to control
The worry driving those calls is that the technology is outrunning anyone's ability to keep a hand on it.
“fears the technology could be becoming too powerful to control”
U.K. names catch the flows
The cash had to land somewhere. U.K.-based stocks were among the winners as investors looked outside the AI complex.
The key point
The AI trade can unwind on sentiment alone, and when it does, the money moves to the sectors AI was supposed to disrupt.
