Concerns about artificial intelligence have been brewing on Wall Street for months. But the reaction this week to a small research firm’s dire scenario that A.I. will drive mass unemployment and a plunge in stock values reflects a deep skittishness in markets.
In a note that was widely circulated on social media over the weekend, Citrini Research painted a dark picture of what might happen to the economy as A.I. upends white-collar work. The report described well-paid professionals forced to become Uber drivers and missed mortgage payments by displaced tech workers in Seattle and Austin, Texas.
The Citrini report was cited as one factor fueling a modest decline in the S&P 500 on Monday. Although the market rebounded on Tuesday, the report continued to stoke the debate among investors and policymakers about the extent of A.I. disruption. Some bearish investors said the report amplified previous warnings about A.I.’s threat to the economy. Others, including a Federal Reserve governor, brushed off the report’s conclusions.
“The argument leans heavily on narrative and emotion rather than hard evidence,” Jim Reid, a strategist at Deutsche Bank, said of the report. “That doesn’t mean it will ultimately be wrong.” But he added that the “vibes-to-substance ratio is undeniably high.”
The viral nature of the research report, which was viewed millions of times online, appeared to tap into investor angst that has stalled gains for the stock market’s recent leaders, led to heavy losses for companies deemed vulnerable to A.I. and lifted some previously unloved sectors.
In recent months, investors have been both questioning how revolutionary A.I. will be in practice, undercutting the lofty forecasts for profit growth at some large tech companies, and asking what could happen if its impact is actually far greater.
The research by Citrini sought to model what might happen to the economy if the current lofty expectations for the impact of A.I. end up being too conservative.›
Citrini publishes macroeconomic research.
Citrini Research did not immediately respond to a request for comment.
On Monday, the S&P 500 slumped 1 percent, a modest drop that masked volatility, with big moves either higher or lower for individual stocks largely canceling each other out. IBM and Datadog, another tech company, led losses, both down over 10 percent. Consumer staples stocks, which are seen as safe and reliable, benefited, with Clorox, Kroger and Mondelez all rising.
By Tuesday, the S&P 500’s sell-off had already halted, but the churn beneath the surface continued.
The index rose 0.8 percent, as some of the companies that had sunk a day earlier floated higher again. IBM rose 3 percent and Datadog 1.5 percent. Expedia, the travel booking company, rose 5 percent on Tuesday after a 7 percent drop on Monday.
The stock swings are illustrative of increasing wariness of the artificial intelligence narrative that underpinned large gains in the stock market in recent years. According to analysts at Barclays, the S&P 500 has traded within a 2.7 percent range over the past six weeks, its most muted movement over the past century besides spells in 1964 and 1966. But individual stocks, on average, have had moves nearly seven times as large as the index.
“This calm at the macro level masks wild gyrations at the micro level,” the Barclays analysts wrote last week.
The S&P 500 has flatlined this year after rising 16 percent in 2025 and over 20 percent in 2024. The Dow Jones industrial average is slightly higher, while the tech-heavy Nasdaq Composite index is slightly lower, as investors have shifted away from the A.I. theme and toward other sectors that have lagged in recent years.
One Wall Street trading desk said in a note to clients on Tuesday that the “indiscriminate selling” of technology companies at the start of the week was similar to trading it had been seeing for months.
The price of gold, seen as a haven in times of market worry, rose sharply on Monday before easing somewhat on Tuesday.
On Tuesday, Christopher Waller, a governor on the Fed Board, noted that he had not read the Citrini report “deeply” but pushed back on the broader idea that A.I. will lead to a rapid rise in unemployment as technology displaces white-collar workers.
“I don’t think that is going to happen,” Mr. Waller said, adding that he is “not a doom-and-gloomer like the report was.”
“A.I is a tool,” he said. “It is not going to replace us as human beings.”
Joe Rennison writes about financial markets, a beat that ranges from chronicling the vagaries of the stock market to explaining the often-inscrutable trading decisions of Wall Street insiders.
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