Citrini Research on Monday discussed hypothetical scenarios of artificial intelligence impacting markets and the global economy in a report on Monday.
- Wells said that American Express is the analyst's top pick with an Overweight rating and $425 price target.
- Wells in a note said that it disagrees with the negative AI reports in the market today that it says highlight material unemployment risk and stablecoin.
- Citrini said in its hypothetical scenario in 2027 it flagged early signs of invisible stress.
Shares of credit card firms fell on Monday after a report from Citrini Research discussing hypothetical scenarios of artificial intelligence impacting markets and the global economy.
At the time of writing, shares of American Express dropped 7.5%.
Citrini Report Says What?
Citrini Research discussed several hypothetical scenarios of artificial intelligence impacting markets and the global economy. The report emphasized that it is exploring under-researched situations.
Citrini Research report said it sees a scenario wherein, looking back from 2028, the AI explosion leads to a plunge in white-collar employment and ultimately to a stock market crash.
In Citrini’s hypothetical scenario for 2027, initial indicators of hidden financial strain emerged, such as increased HELOC activity, more frequent 401(k) withdrawals, and rising credit card balances, even though mortgage payments were kept up to date. As unemployment climbed, hiring stalled, and bonuses were eliminated, these high-credit households experienced their debt-to-income ratios doubling.
Wells Fargo On AXP
Wells Fargo on Monday said that the selloff today in shares of American Express "represents a unique opportunity" to buy the stock at an attractive valuation.
“Wells disagrees with the negative AI reports in the market today that it says highlight material unemployment risk and stablecoin. The U.S. consumer is stable with strength in the affluent segment and will benefit from stimulus through the year,” the analyst told investors in a research note.
It is "rational to worry about white-collar job losses from AI, but not to the scale that bears seem to highlight today," Wells contends. American Express is the analyst's top pick with an ‘Overweight’ rating and $425 price target.
How Did Stocktwits’ Users React?
Retail sentiment around AXP trended in ‘bullish’ territory amid ‘high’ message volume.
Shares in the company have risen nearly 8% over the past year.
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