Citigroup is taking a more cautious view of U.S. stocks, warning that growing concerns over AI safety could slow model development and weaken earnings-per-share (EPS) revisions. Stuart Kaiser, head of U.S. equity trading strategy at Citigroup, and his team said in a Sunday client note reported by MarketWatch that the upcoming November midterm elections, rising bond yields and surging oil prices could add cross-asset pressure to equities. The strategists said last week's 0.8% decline in the S&P 500 showed stocks exposed to macroeconomic risks without earnings support. They expect a difficult period marked by limited earnings momentum, a seasonally weak September and a summer pullback, creating a "higher bar to re-engage" for investors. Power-generation and data-center companies may be more sensitive to election-related news flow than semiconductor and memory stocks. Citigroup expects the S&P 500 to remain within 2% of its August highs, leaving "investors on the sidelines"; a 3%-5% decline could attract dip buyers, while a test of all-time highs would be needed to trigger a broader chase. Microsoft, Alphabet, Meta Platforms and Amazon.com were among the stocks identified for monitoring. The note comes as Anthropic CEO Dario Amodei called for a slowdown in AI development, while OpenAI CEO Sam Altman and Space Exploration Technologies Corp. CEO Elon Musk have also raised concerns about AI risks. President Donald Trump opposed slowing development or imposing heavy regulation, arguing that the U.S. must preserve its technological lead over China, while acknowledging that guardrails could be introduced.