AI Fear Drives Rout, Goldman Lawyer Quits Over Epstein Ties, More
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Yet more companies are being caught up in the so-called AI scare trade. Logistics stocks plunged on Wall Street, triggered by a former karaoke company's announcement of a new platform. Algorithm is only worth a tiny fraction of the value that was erased from a constellation of larger companies, with the Russell 3000 trucking index tumbling by 6.6%. The sharp move lower follows weeks of mounting anxiety over AI's impact across multiple sectors, with concerns now showing signs of morphing into a broader reassessment of risk. Asian stocks followed US indexes lower, while traditional safe haven assets including gold, copper and silver also declined sharply. Motley Fool Asset Management's Shelby McFadden says this marks the next stage of the AI cycle and that it is unfolding faster than she expected.
Now we're starting to even think about labor implications, which I myself didn't think the market would start to consider for maybe another couple of months. So it seems that now maybe some investors are doing a little bit of a spiral where it's how many things does this touch? Is this a sort of splatter where we need to look all around the room and find all of the different places that there is this sort of AI residue? Seems to me that that's the market's conclusion right now.
McFadden added that she sees logistics and consultancies as among the more inefficient sectors at risk. The latest market ructions come as Anthropic announced it has completed a $30 billion funding round at a $380 billion valuation. The firm's technology, including coding agents and tools that automate enterprise work tasks, has been at the heart of recent sell-offs that have shaken global markets.
US President Donald Trump is reportedly looking to scale back tariffs on steel and aluminium goods. The Financial Times says the White House is looking at introducing more targeted measures as a way to combat the cost of living. Bloomberg's James Walcock has more.
Republicans are growing anxious. Earlier this week, the House of Representatives passed a bill directly targeting the President's tariffs on Canadian imports. It's this growing nervousness about the cost of living and upcoming midterms that are the background to the FT's story. The paper cites three unnamed sources saying White House trade officials were worried tariffs were hurting consumers by hitting the prices of food and drinks cans. Countries including the UK, Mexico and Canada, as well as EU members, could stand to benefit from any easing. In London, James Woolcock, Bloomberg Radio.
Goldman Sachs' top lawyer is leaving the firm following the release of documents highlighting her links to sex offender Jeffrey Epstein. CEO David Solomon announced that Cathy Rumler will step down at the end of June, adding that he respects her decision to resign and that she would be missed. Bloomberg's finance reporter Harry Wilson says the revelations from the Epstein files are likely to keep coming.
What we're seeing is a whole host of people around the world, often very wealthy, very influential people, being caught up in this, I guess, ever-growing scandal, which is that they in some way have either had links, connections, were close friends, associates of Jeffrey Epstein, and those relationships now are getting exposed in a very public and a very damaging way for them.
Our reporter Harry Wilson referring there to others mentioned in the documents, including former US Treasury Secretary Larry Summers and attorney Brad Karp.
How is AI impacting the stock market and investor sentiment?
The bank said that Rumler disclosed to its leadership at the time that she had previously dealt with Epstein, who had offered to use his network to help her build her private practice.
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