Investor enthusiasm for artificial intelligence weakened as major tech stocks sold off, with Nasdaq futures down premarket. Nvidia fell 3.5% and Palantir slid nearly 10% following an MIT report claiming 95% of companies investing in generative AI see no returns and comments from OpenAI's Sam Altman warning of a possible AI bubble. The MIT study attributed poor outcomes to corporate "learning gaps" and flawed integration rather than model quality. The Nasdaq recorded its steepest drop since August, and losses spread to global suppliers and chipmakers while some Chinese tech and chip stocks showed limited movement or gains.
Nvidia, fresh off becoming the world's first $4 trillion company, sank 3.5%, while Palantir slid nearly 10%. The sell-off appeared to be sparked in part by an MIT report that claimed 95% of companies investing in generative AI are seeing no returns, and was potentially deepened by earlier comments from OpenAI's Sam Altman suggesting investors may be caught in an AI bubble.
Investors' long-running enthusiasm for artificial intelligence showed signs of faltering late Tuesday and early Wednesday morning as tech stocks tumbled. Nasdaq 100 futures were off 0.2% this morning, premarket. Nvidia, fresh off becoming the world's first $4 trillion company, sank 3.5%, while Palantir slid nearly 10%. The sell-off appeared to be sparked in part by an MIT report that claimed 95% of companies investing in generative AI are seeing no returns, and was potentially deepened by earlier comments from OpenAI's Sam Altman suggesting investors may be caught in an AI bubble. Late last week, Altman drew a parallel between today's AI frenzy and the 1990s dotcom bubble, when internet company valuations spiked dramatically before crashing. And while the MIT study attributed failures to corporate "learning gaps" and flawed integration rather than actual AI model quality, the market reaction highlights growing concerns about AI's commercial viability.
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