US Stocks Plunge Over $1 Trillion as Chinese AI App DeepSeek Emerges
DeepSeek, an AI app from a Chinese startup, has sparked a sell-off in US stocks, erasing over $1 trillion in market capitalization on Monday.
AI Competition Heats Up
DeepSeek debuted an AI model comparable to US rivals at a significantly lower cost. This has raised concerns about US tech dominance in the AI race.
Tech Giants Suffer Steep Losses
Tech stocks took a beating, with Nvidia losing a staggering $589 billion in market cap. The decline represents the largest single-day loss of market value in history.
S&P 500 and Nasdaq Composite Tumble
The S&P 500 closed down 1.46%, while the Nasdaq Composite shed 3.07%, led by declines in major chip firms like Broadcom and Taiwan Semiconductor Manufacturing Company.
DeepSeek Dominates App Store
DeepSeek's surge in popularity on the Apple App Store in the US has fueled the panic among investors. The app outperformed OpenAI's ChatGPT in several tests.
US Indexes at Closing Bell
* S&P 500: 6,012.28, down 1.46%
* Dow Jones Industrial Average: 44,713.58, up 0.65%
* Nasdaq composite: 19,341.83, down 3.07%
Analyst Insights
Angelo Zino of CFRA Research urges investors to take China's AI innovation seriously. David Bahnsen of The Bahnsen Group warns that China could become a major competitor in the AI space.