Singapore, Asia markets fall on Tuesday amid calls for AI slowdown; STI down 1.4%

[SINGAPORE] Singapore and Asia markets ended lower on Tuesday (Sep 15), after top executives in US artificial intelligence companies and leading chipmakers called for a slowdown in AI development.

They raised safety concerns regarding the pace the tech was developing at, causing broader investor jitters.

The benchmark Straits Times Index (STI) lost 1.4 per cent or 79.38 points to finish at 5,638.64.

Across the broader market, losers outnumbered gainers 346 to 176, after 1.1 billion securities worth S$1.8 billion changed hands.

Mapletree Pan-Asia Commercial Trust led the gainers on Singapore’s blue-chip index, rising 0.8 per cent or S$0.01 to S$1.21.

The worst performer among STI constituents was OCBC , which fell 2.7 per cent or S$0.85 to S$31.

The other two local banks also ended lower, with DBS losing 1.2 per cent or S$0.91 to S$76.75, and UOB down 2.4 per cent or S$1 at S$41.33.

Within the iEdge Singapore Next 50 Index, First Resources was the top gainer, rising 4.3 per cent or S$0.20 to S$4.83, while UltraGreen.ai was the biggest decliner, falling 5.1 per cent or US$0.03 to US$0.555.

Key regional indices were negative. Hong Kong’s Hang Seng Index lost 1 per cent, Japan’s Nikkei 225 fell 0.01 per cent, South Korea’s Kospi was down 0.9 per cent and the FTSE Bursa Malaysia KLCI declined 1.1 per cent.

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AI safety concerns are “not new”, said Louis Chua, equity-research analyst Asia at Julius Baer.

“(However,) we believe the market’s knee-jerk reaction reflects growing investor caution regarding the sustainability of strong AI-related earnings, compounded by major macroeconomic events, including (the) upcoming Federal Open Market Committee and Bank of Japan meetings,” he said in a Tuesday note.

Many AI-exposed names are likely to experience the highest volatility during this period, he added.

Still, he remains confident in the role of leading Japanese companies in accelerating the global AI infrastructure build-out, which is “healthy and supported by genuine demand”.

“Robust earnings growth, record levels of shareholder returns through buybacks and dividends, improving return on equity, and ongoing structural reforms continue to support our Nikkei 225 target of 75,000,” he added.

This article was written with the assistance of AI and reviewed by a reporter