Pre-Market Update: AI Fears, Rising Bond Yields, and the Fed Meeting Explained

TLDR

• US stock futures dropped Tuesday with the Dow, S&P 500, and Nasdaq all falling in premarket trading
• Anthropic CEO Dario Amodei, along with OpenAI’s Sam Altman and Elon Musk, called for an AI slowdown, triggering a chip stock selloff
• The 10-year Treasury yield briefly hit 5%, its highest level since 2023, raising borrowing cost concerns
• Oil prices climbed, with WTI crude rising to over $103 a barrel due to Middle East tensions
• The Federal Reserve’s September meeting kicks off Tuesday, with traders pricing in a 94% chance of a rate hike

US stock futures fell Tuesday morning as investors faced a trio of headwinds: rising oil prices, surging bond yields, and fresh fears about an artificial intelligence slowdown.

Futures on the Dow Jones Industrial Average dropped around 0.7%, while S&P 500 futures fell 0.6% and Nasdaq 100 futures declined 0.7%.

AI Leaders Call for a Slowdown

The selling started Monday after Anthropic CEO Dario Amodei published an essay raising AI safety concerns. OpenAI CEO Sam Altman and SpaceX CEO Elon Musk also called for a slowdown in AI development.

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