AI Safety Warnings, Oil Surge Push Wall Street Lower

The 10-year Treasury yield briefly crossed 5% on Monday, while Brent crude climbed above $105 a barrel, giving investors two reasons to trim risk just as another one emerged from the artificial-intelligence trade.

The S&P 500 fell 0.5% to 7,619.98, the Dow Jones Industrial Average slipped 0.3% to 52,421, and the Nasdaq Composite lost 0.6% to 26,186, according to market data reported by The Associated Press. The declines were measured, but the damage beneath the indexes was sharper. Semiconductor shares absorbed the heaviest selling.

Nvidia dropped 3.4%, Intel fell 5.6%, and Advanced Micro Devices lost 4.4%. Marvell Technology and Micron Technology also suffered steep declines, reflecting concern that a slower pace of frontier-AI development could eventually curb the enormous capital budgets now flowing toward chips, servers, networking equipment and data centers.

That concern followed weekend calls from OpenAI chief executive Sam Altman, Anthropic chief executive Dario Amodei and other technology leaders for more deliberate development of advanced AI systems. Their argument centered on safety and control, not a forecast that demand for computing will disappear. Markets nevertheless treated the language as a threat to the spending cycle that has powered the sector.

The pressure was amplified by rates. The 10-year Treasury yield reached 5.01%, its highest level since 2023, before easing later in the session. Higher yields raise financing costs across the economy and reduce the present value investors assign to distant profits, a particularly awkward combination for companies whose valuations depend on years of expected AI growth.

Oil added an inflationary edge. Brent settled near $105.68 a barrel after reports of attacks on energy infrastructure and shipping in the Middle East, while West Texas Intermediate rose above $100. Traders are now confronting the possibility that expensive fuel keeps inflation elevated even as economic growth loses momentum.

That backdrop has shifted expectations for the Federal Reserve’s September 16 meeting. Futures markets were pricing roughly a 90% chance of a quarter-point rate increase, according to CME Group’s FedWatch tool, a sharp repricing from the prior week.

Some software and cybersecurity stocks resisted the selloff. CrowdStrike rose about 14% and Palo Alto Networks gained roughly 13%, suggesting investors were rotating within technology rather than abandoning it wholesale. The market’s next test is whether oil and yields remain elevated long enough to turn a one-day AI scare into a broader valuation reset.