Nuclear Stocks Tumble Amid DeepSeek AI Concerns
Nuclear energy stocks faced a downturn on Monday, with several leading companies experiencing drops of over 20%. This sell-off is attributed to growing concerns about the DeepSeek AI tool from China, which has raised questions about the potential erosion of US AI dominance.
Nuclear energy providers have been positioning themselves as key suppliers for data centers that support the rapidly expanding AI industry. However, DeepSeek's introduction has cast doubt on this narrative, as its lower energy consumption and cost-effectiveness pose a competitive threat.
"DeepSeek has sparked significant concern among US technology investors," said Jay Woods, chief global strategist at Freedom Capital Markets. "The potential for this tool to reduce energy requirements and costs is alarming for our tech industry."
The sell-off reversed the upward trend seen in nuclear power stocks last week, when they surged on expectations of an AI boom following President Trump's announcement of a $500 billion infrastructure project.
Among those affected by Monday's downturn were Nuscale Power Corp, Vistra Corp, Talen Energy Corp, Constellation Energy Corporation, and Oklo. BWX Technologies and Cameco Corp also saw declines.
The recent gains in nuclear energy stocks over the past year have been eroded by this sell-off, as investors reconsider their bullish stance on the sector given the uncertainty introduced by DeepSeek.