Market Tremors as DeepSeek AI Model Shakes Tech Stocks
Tech stocks in the U.S. fell sharply as DeepSeek's affordable AI model challenged market valuations, raising safety concerns among investors. This led to a significant rise in U.S. government bonds and safe-haven currencies, despite a slight rise in the Dow Jones.

In a wave of market turbulence, U.S. technology stocks plummeted on Monday as the emergence of DeepSeek's cost-effective AI model cast doubts over the sector's lofty valuations. Concerns of overvaluation propelled investors towards safer assets, boosting U.S. government bonds and safe-haven currencies like the yen and Swiss franc.
DeepSeek's rise to the top of Apple's App Store, overtaking ChatGPT, highlighted the company's innovative use of lower-cost chips and minimal data. This challenged the prevailing market belief that AI would spur demand throughout the chip-to-data center supply chain. Although the Dow Jones Industrial Average gained a modest 0.65%, the S&P 500 dipped 1.5% and the tech-laden Nasdaq Composite plunged roughly 3%.
Nvidia, a leader in AI chip production, witnessed a 17% drop, aligning with declines at Broadcom and Marvell Technology. Wall Street's fear gauge, the CBOE Volatility Index, surged by 20%, reflecting heightened market instability. As U.S. Treasury yields fell to multi-week lows, the pursuit of safer investments dominated trading activity.
(With inputs from agencies.)