Tech stocks tumble as investors flee — is the AI bubble finally about to burst?
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Big Tech Stocks Take a Hit Amid AI Market Slowdown
MIT Study Finds AI Yields Limited Returns for Most Companies
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OpenAI CEO Sam Altman Warns of AI Investment Bubble
Market Experts See AI Hype Normalizing, Not Collapsing
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AI Bulls Remain Confident in Long-Term Growth
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: The glow of the AI boom dimmed further on Wednesday as tech stocks slid for a second straight day, raising concerns about whether the market's AI obsession is now starting to cool off, as per a report.Investors appeared to be backing away from some of the biggest winners of the year, according to Yahoo Finance. Amazon and Apple dropped almost 2%, while Alphabet fell about 1%. Nvidia, one of the most talked-about stocks of the AI wave, closed slightly down after a steeper drop the day before, as per the Yahoo Finance report. Advanced Micro Devices and Broadcom slipped as well, and Micron tumbled nearly 4%, according to the report.Even companies built directly on AI infrastructure weren't spared, like CoreWeave, which rents computing power to tech giants like Microsoft and Meta, dropped about 1%, bringing its five-day losses to more than 20%, as reported by Yahoo Finance. Palantir, a defense tech firm that had been riding high on AI momentum, also declined for the day, extending its recent losing streak, according to the report.ALSO READ: Putin's midnight ultimatum: Trump forced into 15-minute deadline for late-night chat The growing caution around AI-linked stocks seems to stem from two major blows this week, as per the Yahoo Finance report.First was a report from researchers at Massachusetts Institute of Technology's Project NANDA, which found that 95% of the companies it studied saw no real return from AI so far, according to the Yahoo Finance report.ALSO READ: Shocking twist: Computer Science grads face one of the highest unemployment rates today Then came a surprising commentary from one of AI's most prominent voices, OpenAI CEO Sam Altman, just after the ChatGPT-maker finished out its latest multibillion-dollar funding round, as per the report. He said that he believes there's an AI bubble, as reported by Yahoo Finance.Altman pointed out that, 'When bubbles happen, smart people get overexcited about a kernel of truth,' adding, 'Are we in a phase where investors as a whole are overexcited about AI? My opinion is yes," as quoted in the report.ALSO READ: Iran flexes firepower: Massive missile drill aims warning at US and Israel after June war While DA Davidson analyst Gil Luria compared the changing market sentiment to a pendulum, saying, 'This is really just the pendulum swinging back,' as quoted by Yahoo Finance.Luria highlighted that, 'The AI trade was getting so expensive that all it took was some comment from Sam Altman to make the investment community take some profits off the table,' and added that 'the reality is that AI still has limited applications' beyond consumers talking to AI chatbots and using the tools as a search engine, as reported by Yahoo Finance.ALSO READ: Apple Watch SE 3 leaks spill major upgrades — and fans can't stop buzzing about what's coming However, some AI bulls, like Wedbush analyst Dan Ives, still have faith in the technology's ability to fuel markets to new highs, Ives said, 'We are still in the early days of the AI Revolution as the use cases are just starting to massively expand as more companies recognize the value creation being driven by a handful of tech companies led by the Godfather of AI [Nvidia CEO] Jensen [Huang] and Nvidia,' as quoted in the report.Ives also emphasised that 'the tech bull cycle will be well intact at least for another 2-3 years given the trillions being spent on AI,' as quoted in the report.ALSO READ: Move over quiet quitting — as AI looms 'quiet cracking' is costing $438 billion and wrecking workers' health Amazon, Apple, Alphabet, Nvidia, AMD, Broadcom, Micron, CoreWeave, and Palantir all saw declines recently, as per the Yahoo Finance report.Sam Altman said he believes the market is currently in an AI bubble and that investors may be 'overexcited' about the technology's potential, as per the Yahoo Finance report.
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