AI market rally amid studies on returns and early job losses

A flurry of market moves, academic studies and corporate launches this week has crystallized competing narratives about artificial intelligence: it is both the engine of a market surge and a source of growing financial and labor-market risk. Investors reacted coolly even as AI leaders reported strong results, researchers found early signs of job displacement for young workers, and software firms rolled out tools to stress-test AI agents before deployment.

On Wall Street, AI remains a dominant force but also a source of anxiety. Nvidia, the sector bellwether, posted results that beat analysts yet drew little enthusiasm, with shares slipping about 4 percent in the two days after the report despite the company continuing to account for a large share of market capitalization. Market-watchers warned that sky-high valuations on many AI-related companies, some trading at hundreds of times forward earnings, make stocks vulnerable if sentiment shifts. "We are looking at a red Dodge and calling it a Ferrari," said Ted Mortonson, a managing director at Baird, summing up concern that hype may be outpacing fundamentals. Other analysts urged caution and concentration on firms with durable...