Calls from AI leaders to slow model development have weighed on tech stocks, but a Truist analyst says the sell-off looks overdone. Microsoft, Alphabet, Amazon and Meta fell on fears of reduced AI-related spending, though a MarketWatch columnist argues that reasoning may be backwards.
Calls from Anthropic CEO Dario Amodei, OpenAI's Sam Altman and Elon Musk to slow the pace of artificial-intelligence development have become the latest overhang on fast-growing tech stocks. But the market might be overreacting to what a slower AI buildout actually means, according to Truist analyst Sam Grelck.
Tech stocks have not traded this cheap since the launch of ChatGPT, and demand for chips, data centers and other infrastructure is likely to keep accelerating even if the pace of AI development slows, Grelck wrote in a Tuesday note. He said he remains skeptical that slower model development would reduce total demand for that infrastructure over time.
Several major tech names fell after the AI leaders' comments rippled through the market. Microsoft slipped 0.92%, while Alphabet's shares dropped 1.57%. Amazon fell 1.73%, and Meta Platforms slipped a more modest 0.03%.
The thinking behind the move: if AI labs build advanced models less aggressively, they may need fewer accelerators, memory chips, networking components and data centers. There is also a prevailing view that a slower AI pace could give established software vendors a longer runway against disruption fears.
Sources: MarketWatch, MarketWatch (snippet-based)
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