After DeepSeek, a Chinese AI startup, expressed reservations about American industry leadership, US technology stocks plummeted. Shares of Nvidia fell more than 12%, possibly wiping off $432 billion from the company's market value. ASML and other chipmakers also saw a drop.
After Chinese AI startup DeepSeek cast doubt on America's position as the industry leader, US technology markets slumped on Monday. The shares of a number of chipmakers fell as a result; in pre-market trading, Nvidia, one of the most valuable businesses in the world, dropped more than 12%.At 6:27:29 AM EST, Nvidia's stock was down 12% at $125.05 in pre-market trading compared to its closing price of $142.62. The market might lose $432 billion from Nvidia if the decline continues when regular trading resumes.
In addition to Nvidia, ASML and ASM International, two semiconductor makers based in the Netherlands, had a decline of 10–14% in European trading.
Both ASML, which builds equipment to make high-end chips, and Nvidia, which creates semiconductors for AI, have profited from the surge in AI spending.
However, because it is less expensive to operate and runs on less sophisticated circuits, the most recent AI model, DeepSeek, which was unveiled last week, is thought to be a serious rival to those from OpenAI and Meta Platforms Inc. The DeepSeek-V3 model was reportedly constructed for $5.6 million, which is a lot less than what the US IT giants utilize. According to a Reuters report, the open-source product has risen to the top of Apple Inc.'s App Store rankings.
US Stocks Collapse
With losses of more than 3% apiece, major tech firms like Microsoft and Meta Platforms also suffered. Apple lost 1.5% while Alphabet, the parent company of Google, lost 3%. This week, Apple, Microsoft, and Meta are scheduled to release their quarterly financial results.
The tech-heavy Nasdaq 100 E-minis crashed more than 3%, while Dow E-minis and S&P 500 E-minis fell about 2%, signaling a gap-down opening for Wall Street.
Both ASML, which builds equipment to make high-end chips, and Nvidia, which creates semiconductors for AI, have profited from the surge in AI spending.
However, because it is less expensive to operate and runs on less sophisticated circuits, the most recent AI model, DeepSeek, which was unveiled last week, is thought to be a serious rival to those from OpenAI and Meta Platforms Inc. The DeepSeek-V3 model was reportedly constructed for $5.6 million, which is a lot less than what the US IT giants utilize. According to a Reuters report, the open-source product has risen to the top of Apple Inc.'s App Store rankings.
US Stocks Collapse
With losses of more than 3% apiece, major tech firms like Microsoft and Meta Platforms also suffered. Apple lost 1.5% while Alphabet, the parent company of Google, lost 3%. This week, Apple, Microsoft, and Meta are scheduled to release their quarterly financial results.
The tech-heavy Nasdaq 100 E-minis crashed more than 3%, while Dow E-minis and S&P 500 E-minis fell about 2%, signaling a gap-down opening for Wall Street.
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