AI stocks fell worldwide Monday after leaders in the industry warned that development should slow so safety measures can catch up. That’s the first crack in the glossy sales pitch: the people building the machine are now admitting it may outrun the controls, while the rest of the world gets dragged through the fallout.
Who Gets to Decide
Anthropic CEO Dario Amodei said the industry needs a deliberate and global slowdown, citing safety concerns and warning that AI could become capable within six to 12 months of leading a swarm of agents that could take over the entire internet. That warning came from inside the apparatus itself, not from workers, not from the public, and not from anyone who gets to live with the consequences on equal terms.
President Donald Trump played down the need for his administration to check AI development, saying he worried about ceding the United States' edge over China in a global competition and that winning would help address the risks from the advancing technology. On his social media network Monday, Trump said the only guardrail AI needs "is a STRONG AND SMART (High IQ!) PRESIDENT, and the U.S.A. has that, in spades!" The message was plain enough. The state doesn’t plan to restrain the machine so much as manage it for national advantage.
Markets First, People Later
The market reaction was broad but uneven. The S&P 500 fell 0.3%, while the Dow Jones Industrial Average was down 74 points, or 0.1%, and the Nasdaq composite was 0.4% lower after clawing back most of an early loss of 1.3%. Nvidia sank 2.8% and was the heaviest weight on the market because of its size. SpaceX slipped 0.1% after Elon Musk said over the weekend that he agrees with Amodei. SoftBank Group lost 10.7% in Tokyo after OpenAI's Sam Altman supported the concept of a slowdown.
Altman also said in an interview with Fortune published Saturday that OpenAI would likely wait until next year for a sale of its stock on Wall Street, which could delay cash for SoftBank and other early investors in OpenAI. Even the talk of restraint gets filtered through capital’s timetable. The question isn’t whether the technology serves the public. It’s when the money moves.
In South Korea, the Kospi index dropped 3.3% because of losses for Samsung Electronics and SK Hynix. Helping to limit Wall Street's losses were several software companies that had tumbled earlier on worries AI-powered competitors would undercut their businesses. Intuit rose 5.1%, Autodesk climbed 7.2% and Adobe added 4.2%.
War, Oil, and the Cost Below
Oil prices also moved markets. Brent crude rose 2.7% to $107.46 after getting near $110 in the morning, as fighting in the Middle East kept squeezing the global flow of oil. An important Saudi oil pipeline will mostly be out of service for weeks following an attack last week, two regional officials told The Associated Press. The pipeline offered a way for Saudi Arabia to shift exports to the Red Sea and avoid the Persian Gulf's Strait of Hormuz, where Iranian attacks have stifled the movement of oil tankers.
Brent has jumped from less than $72 in early July as doubts rise that the United States and Iran can reach an agreement that would allow oil tankers to freely exit the Persian Gulf through the strait again. ING commodities strategists Warren Patterson and Ewa Manthey wrote Monday that the situation is still fluid and that "sizable" volumes of oil have still been moving through the strait.
The jump in oil prices has sent the average cost of a gallon of regular gasoline across the country to nearly $4.32 from $4.08 a month ago and $3.18 a year ago, according to AAA. That upward pressure on inflation has much of Wall Street expecting the Federal Reserve will hike its main interest rate on Wednesday at the end of its next meeting. The 10-year Treasury yield breached 5.00% during the morning for the first time in nearly three years, up from 4.96% late Friday and just 3.97% before the war with Iran began in February, before later pulling back to 4.95% as oil prices came off their highs.
The yield has not consistently remained above 5% since the turn of the millennium, and its jump has already made it more expensive for U.S. households and companies to borrow, including the highest average long-term mortgage rate in more than 14 months. The people at the bottom pay for the decisions made at the top, again and again, whether the trigger is a war, a pipeline attack, or a boardroom panic over the next machine.