American AI stocks got sucker punched after China's DeepSeek app reportedly showed advancements against rivals sending investors into sell mode, shaving 3% off the Nasdaq.
America’s AI race among U.S. tech titans got suckered after Chinese AI app DeepSeek crashed onto the scene, sending investors into reverse. The tech-heavy Nasdaq Composite nearly erased its gains for the year, falling 3% on Monday. DeepSeek’s model appears able to match the capability of chatbots like OpenAI's ChatGPT and Meta’s Llama but at a fraction of the development cost. It also rose to No. 1 on the Apple App Store over the weekend.
The chipmaker, a darling of AI, lost almost 17%. It’s the worst percentage day since March 2020, as tracked by Dow Jones Market Group. About $600 billion in market cap was wiped out and trimmed CEO Jensen Huang’s net worth by about $20 billion in one day. HOW DEEPSEEK IS SHAKING US AI DOMINANCE An Nvidia spokesperson told FOX Business: "DeepSeek is an excellent AI advancement and a perfect example of Test Time Scaling.
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