The AI hype cycle faces its first setback as summer doldrums drag on some of this year’s biggest winners

• Even AI-related stocks haven’t been immune from this month’s market sell-off.
• Shares in semiconductor firms have slipped, with Nvidia set for its first monthly decline of 2023.
• Meanwhile, investors have started betting against funds tracking the AI sector.

Stocks are off to disappointing start for the month – and the theme that’s taken markets by storm this year seems to be under pressure.

The S&P 500 is down 5% and the tech-heavy Nasdaq Composite has slumped 7% over the first 13 trading days of what’s typically the quietest month of the year for investors – and even artificial intelligence isn’t immune from the sell-off.