SynopsisUS stocks fell on Monday as fears over a slowdown in AI model development hit Nvidia and chipmakers. Nvidia dropped 3.2%, while Intel, AMD and Marvell fell sharply. Defensive sectors gained, while software stocks including ServiceNow and Adobe rose as investors reassessed AI's market impact.Listen to this article in summarized formatETMarkets.comUS stocks slipped on Monday as a selloff in AI-linked stocks weighed on the broader market, with Nvidia and major chipmakers coming under pressure after prominent AI executives called for a slower pace of model development, Reuters reported.Nvidia fell 3.2%, hitting its lowest level in nearly three weeks, while Amazon dropped about 1%. The losses came as investors reassessed the breakneck pace of investment in artificial intelligence, with concerns about the safety and development of increasingly capable AI models adding to uncertainty around some of the market's biggest technology bets.At 9:45 a.m. ET, the Dow Jones Industrial Average was down 126.58 points, or 0.24%, at 52,446.71. The S&P 500 fell 48.23 points, or 0.64%, to 7,608.28, while the Nasdaq Composite dropped 268.13 points, or 1.02%, to 26,064.91.For live updates on US Markets, click here AI optimism takes a hitThe latest pressure on AI stocks followed calls from executives including Anthropic CEO Dario Amodei, OpenAI CEO Sam Altman and xAI chief Elon Musk for greater caution around the development of AI models.Amodei on Saturday called on AI companies to slow the pace at which they advance model capabilities. Musk and Altman said they agreed with him.The comments have added to concerns that the enthusiasm surrounding AI could be entering a more cautious phase after billions of dollars of investment helped drive sharp gains in technology and semiconductor stocks in recent years.Chipmakers bore the brunt of the selling. Intel, AMD and Marvell Technology fell 5.6%, 5% and 6.3%, respectively. The Philadelphia SE Semiconductor Index dropped about 6% and was on track for its steepest one-day decline since July 1 if the losses held.Still, investors were divided over whether the selloff marked a broader shift in sentiment or a temporary pullback, given the lack of clarity over what a slowdown in AI development would actually mean for companies and their earnings."This is probably more of a hiccup for AI stocks as opposed to an eye-opener," said Dennis Dick, founder and market structure analyst at Triple D Trading.Investors turn to defensive stocksThe weakness in technology stocks did not extend across the entire market. Seven of the S&P 500's 11 major sectors traded higher, with healthcare and consumer staples gaining about 1% each as investors moved towards more defensive parts of the market.The technology sector was the biggest decliner, down 0.5%.Some software stocks moved in the opposite direction, recovering after previous concerns that AI could disrupt their businesses. ServiceNow rose 3.8%, Adobe gained 3.6% and Workday climbed 3.2%.Meta and Alphabet also advanced around 2% each.The contrasting moves pointed to a more selective approach from investors rather than a broad retreat from technology. While semiconductor stocks remained under pressure, some companies seen as potential beneficiaries of AI adoption or less exposed to the immediate concerns around model development found support.The market's reaction reflects a growing debate over whether the enormous investment in AI can continue to justify the valuations and expectations built into technology stocks. For now, investors appear to be weighing the potential impact of a slower development cycle against the longer-term prospects for the technology. (Disclaimer: This article is based on inputs from agencies. These do not represent the views of The Economic Times)Read More News on(What's moving Sensex and Nifty Track latest market news, stock tips, Budget 2025, Share Market on Budget 2025 and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .) Subscribe to ET Prime and read the Economic Times ePaper Online.and Sensex Today. Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price...moreless(You can now subscribe to our ETMarkets WhatsApp channel)Read More News on(What's moving Sensex and Nifty Track latest market news, stock tips, Budget 2025, Share Market on Budget 2025 and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .) Subscribe to ET Prime and read the Economic Times ePaper Online.and Sensex Today. Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price...moreless