Market volatility continues as Al fears disrupt tech stocks

STOCKS mostly fell yesterday to track more losses on Wall Street, where tech firms were again under pressure as fears over vast Al investments and extended valuations gained momentum.

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PEDESTRIANS stand in front of an electronic quotation board displaying the numbers of the Nikkei Stock Average on the Tokyo Stock Exchange in Tokyo, Japan.

(AFP)

While the extreme volatility that greeted the start of the week has calmed, traders remained on edge over the impact of artificial intelligence on companies’ bottom lines, while precious metals again took a drubbing.

The latest development to spook markets was news that AI startup Anthropic - which created the Claude chatbot - had unveiled a tool that could be used by firms to carry out legal work.

This week’s announcement hit firms in the software, financial services and asset management industries, though analysts said there has been a general shift by investors out of tech following years of eye-watering gains, and into other industries.

An underwhelming response to earnings from titans including Alphabet, ARM and Microsoft has aided that move, which also comes as questions are raised about the wisdom of pumping hundreds of billions into AI with little idea about the timing of returns.