Volatility Anticipated: Citi Sees More Turbulent Bull Market Amid AI Disruption Fears

On February 16, 2026, Citi predicted that the stock market would experience increased volatility amid growing concerns about the disruption caused by artificial intelligence (AI). The potential impact of AI technology on existing industrial structures and the uncertainty surrounding investor sentiment are escalating, prompting investors to adopt a cautious approach. Concerns are mounting regarding the risks associated with AI’s rapid development, including job displacement, data privacy issues, and increased technological dependence. In this environment of uncertainty, the market is shifting, necessitating adjustments to investment strategies.

The Shadow of AI Disruption: Background to Increased Market Volatility

Citi’s recent outlook reflects concerns about the impact of AI technology on the stock market. While AI offers positive aspects such as increased productivity and the creation of new industries, it also has negative aspects such as the collapse of existing industrial structures, job losses, and the widening of the digital divide. Specifically, AI-based automation has the potential to displace certain job categories, which can trigger social anxiety. According to CoinDesk reports, the pace of AI technology development is much faster than anticipated, and the market’s adaptation speed is relatively slower.

Technological Risks and Investor Sentiment

The development of AI also increases technological risks. AI systems have various vulnerabilities, including data bias, algorithmic errors, and cyberattacks, which can lead to unforeseen losses. Investors must consider these technological risks when making investment decisions. Furthermore, excessive optimism about AI can distort investor sentiment, which can further exacerbate market volatility.

Market Outlook: Sustainability of Increased Volatility

According to Investing.com, Citi predicts that the current market situation is in a phase of ‘increased volatility’ and that this trend is likely to continue. This is due to concerns about AI disruption affecting investor sentiment and the strengthening of investors’ risk aversion. In addition, these factors are combined with other factors such as rising interest rates, inflation, and geopolitical risks, leading to further expansion of market volatility. FireMarkets experts emphasize that in this situation, investors need a cautious approach and a long-term perspective.