Nvidia CEO Jensen Huang pushed back on bubble fears surrounding AI, insisting the industry is in a high production ramp and that major breakthroughs are near. His comments came as the Nasdaq AI index dropped over 40% in the past year, and as the collapse of AI startup AI21 added to sector concerns. Investors remain cautious as the broader market faces its own headwinds.
Markets took a hit as Federal Reserve Chair Jerome Powell signaled possible rate hikes through 2027. The 10-year Treasury yield climbed to 4.8%, its highest since 2007, and growth stocks suffered. The Nasdaq fell 4.2% for the week, while defensive sectors gained ground. AI startups postponed IPOs and venture capital firms tightened their purse strings, reflecting growing unease about financing in the sector.
Google and Meta launched competing consumer AI agents that highlight the intensifying race in this space. Google's CC supports up to six family members managing daily tasks together, while Meta's Muse targets single users with a focus on commerce and digital life autonomy. Analysts view AI agent development as a major battleground for the tech industry going forward.
Four paying subscribers of Claude, ChatGPT, Grok, and Gemini filed a federal class-action lawsuit on September 18, accusing Anthropic, OpenAI, Google, and xAI of illegally coordinating to slow AI product improvements. The plaintiffs argue that a public pledge to build AI more carefully was actually a secret agreement among rivals. Former President Donald Trump dismissed AI safety fears as hoaxes, and the case continues in federal court.
Good Change, a cleaning products business in Bay of Plenty, turned to AI to automate customer service and inventory management after layoffs. The company saw a significant revenue increase and now focuses on strategy and innovation. About 70% of businesses in the region use some form of AI, and other local companies have reached out to learn from Good Change's approach.
Leaders of major AI labs have ignited a national debate about slowing AI development, as trillions of dollars in investment gains depend on continued rapid growth. Jim Morrow, CEO of Callodine Capital Management, warns that the economy is deeply tied to AI expansion. If growth slows, both Wall Street and Main Street could face serious consequences, highlighting the tightrope the industry walks between caution and commercial pressure.
Key Takeaways
- Nvidia CEO Jensen Huang says AI is in a high production ramp despite a 40% drop in the Nasdaq AI index over the past year.
- The 10-year Treasury yield hit 4.8%, its highest since 2007, as the Fed signaled possible rate hikes through 2027.
- The Nasdaq fell 4.2% for the week as growth stocks declined and defensive sectors gained.
- Google launched CC, a family-oriented AI agent for up to six users, while Meta released Muse, a single-user agent focused on commerce and digital autonomy.
- Four subscribers filed a federal class-action lawsuit on September 18 against Anthropic, OpenAI, Google, and xAI, alleging illegal coordination to slow AI improvements.
- Good Change in Bay of Plenty automated customer service and inventory with AI, resulting in a significant revenue increase after layoffs.
- About 70% of businesses in the Bay of Plenty region now use some form of AI.
- Nvidia has a market cap of US$5,362.1b and remains a key player in AI infrastructure despite rising capital costs.
- Coherent reported fiscal 2026 revenue of $7.118b and signed a multi-year agreement with Nvidia.
- AI lab leaders have started a national debate about slowing AI development as trillions in investment gains hang in the balance.
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Nvidia CEO says AI is in high production ramp despite bubble fears
Nvidia CEO Jensen Huang said AI is in a high production ramp during the company's annual meeting. His comments came as the Nasdaq AI index fell over 40% in the past year and investors worried about a bubble. Huang said progress matters and that he believes major breakthroughs are near. His remarks came despite failures in the AI sector, including the collapse of AI startup AI21.
Fed rate fears and AI safety debate shake markets
Markets faced pressure as the Federal Reserve signaled possible rate hikes and AI safety advocates pushed for stricter rules. Fed Chair Jerome Powell's comments led traders to expect higher rate increases through 2027. The 10-year Treasury yield rose to 4.8%, its highest since 2007. Growth stocks fell hard, with the Nasdaq down 4.2% for the week, while defensive sectors gained. AI startups postponed IPOs and venture capital firms became more selective.
3 AI stocks with P E under 28 to watch
Rising bond yields and government borrowing for AI projects are making capital more expensive for AI companies. An article highlights three AI stocks with a P E under 28 that may be undervalued. One featured company is NVIDIA, which makes GPUs and AI platforms for data centers and other uses. NVIDIA has a market cap of US$5,362.1b and earns most sales in the United States and Taiwan.
Lumentum and Coherent compete as top AI optical stocks
AI data center growth is driving demand for high-speed optical products. Lumentum focuses on optical communications like 1.6T modules and optical switching systems. Coherent covers data center transceivers, industrial lasers, and engineered materials. Lumentum reported fiscal 2026 revenue of $3.014 billion, up 83.2% year-over-year. Coherent reported fiscal 2026 revenue of $7.118 billion, up about 23%, and signed a multi-year agreement with Nvidia.
Google CC and Meta Muse spark AI agent rivalry
Google and Meta launched competing consumer AI agents. Google's CC supports up to six family members managing daily tasks together. Meta's Muse is a single-user agent focused on higher autonomy across commerce and digital life. The rivalry highlights growing competition in AI agent development. Analysts expect AI agent innovation to be a major factor in upcoming tech industry competition.
Subscribers sue AI giants over alleged slowdown pact
Four paying subscribers of Claude, ChatGPT, Grok, and Gemini filed a federal class-action lawsuit on September 18. They accuse Anthropic, OpenAI, Google, and xAI of illegally coordinating to slow AI product improvements. The lawsuit argues that a pledge to build AI more carefully was really an agreement among rivals. Former President Donald Trump dismissed AI safety fears as hoaxes. The case now moves forward in federal court.
Bay of Plenty cleantech firm uses AI to replace staff roles
Good Change, a cleaning products business in Bay of Plenty, used AI to automate customer service and inventory management after layoffs. The company saw a significant increase in revenue after implementing the technology. Founders Stine Smith and Kristy Hunter say they now focus on strategy and innovation. About 70% of businesses in the region now use some form of AI. Other local companies have reached out to learn from Good Change's approach.
AI market growth puts U.S. economy at risk if it slows
Leaders of major AI labs have started a national debate about slowing AI development. Trillions of dollars in investment gains and market value depend on continued rapid AI growth. Jim Morrow, CEO of Callodine Capital Management, warns the market and economy are deeply tied to AI expansion. If AI growth slows, Wall Street and Main Street could face serious consequences. The discussion highlights both AI's promise and its potential risks.
Sources
- Get 25 hours of ChatGPT & AI training for just $19.99
- Own 88 hours of AI & cybersecurity training for just $29.99
- AI Bubble Fears Grow, But Nvidia CEO Gives Bulls a New Argument Anyway
- Fed Rate Fears and AI Safety Debate Shake Markets
- 3 AI Stocks With P E Under 28 To Watch
- Lumentum vs. Coherent: Which AI Optical Communications Stock Is Better Suited for Long-Term Holding, LITE or COHR?
- The AI Agent Wars Just Got Personal: Google’s CC vs. Meta’s Muse
- Why Four Subscribers Are Suing Anthropic, OpenAI, Google and xAI Over an Alleged Pact to Slow AI Down
- Bay of Plenty cleantech business replaces staff with AI
- AI’s wobbly house of cards puts markets and U.S. economy at risk
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