AI calls and attacks impact markets
Calls to slow down artificial intelligence due to security reasons and a pipeline attack in Saudi Arabia shook Asian stock markets and oil prices.
Calls from Anthropic and OpenAI to slow down the development of artificial intelligence for security reasons led to sharp declines in Asian stock markets and AI-focused company shares, while an oil pipeline attack in Saudi Arabia pushed crude oil prices higher.
Call to Slow Down in the AI Industry
Calls by Anthropic and OpenAI executives to slow down the development of the artificial intelligence industry for security reasons echoed in the markets. OpenAI CEO Sam Altman supported the calls made by Anthropic CEO Dario Amodei this weekend.
Altman also announced that the company will not conduct its initial public offering this year due to its focus on safety.
Sharp Drop in SoftBank Shares
Shares of SoftBank Group, a Japanese investment holding company among OpenAI's major investors, plummeted by 10.7% following these calls.
This wave of decline in the markets directly affected the shares of other artificial intelligence and chip manufacturing companies as well.
Decline in Asian Stock Markets
South Korea's Kospi index dropped by 3.3% to fall to 6,684.37 points, while Japan's Nikkei 225 index lost 0.8% of its value to decline to 63,492.99 points.
Among other regional stock exchanges, Taiwan's Taiex index fell by 0.7%, and an overall selling trend was observed in Asian equities.
Status of Chip Manufacturing Companies
On Monday, notable declines were also recorded in the shares of companies producing AI-linked chips and hardware.
While South Korean memory chip maker SK Hynix lost 6.4% and Samsung Electronics lost 4.1%, Japan's Tokyo Electron dropped by 1% and Kioxia Holdings by 6.4%. TSMC shares fell by 1.2%.
Oil Pipeline Attack and Prices
Saudi Arabia's main oil pipeline, used to bypass the Strait of Hormuz, was shut down following an attack, which heightened supply concerns.
Amid ongoing US-Iran tensions and increased attacks by Iran-backed Houthis, oil prices rose in early trading on Monday.
Global Oil and Fed Expectations
International benchmark Brent crude increased by 2.8% to reach $107.55 a barrel, while the US benchmark crude rose by 2.9% to $102.90.
Investors are closely monitoring this week's Federal Reserve meeting as inflation continues to remain above the Fed's 2% target.