Wall Street Stumbles as Chinese AI Challenger Shakes US Tech Giants

The S&P 500 and Nasdaq saw notable declines due to investor concerns over a lower-cost Chinese AI model that threatens US tech leaders. Nvidia faced a record $600 billion loss in market value. Meanwhile, DeepSeek's AI Assistant surpassed ChatGPT in Apple's App Store, escalating market tensions.

The S&P 500 and Nasdaq experienced significant drops Monday, driven by concerns surrounding a low-cost Chinese AI model that's pressuring U.S. tech giants. Nvidia's shares plummeted 17%, while the semiconductor index faced its steepest decline since March 2020, losing 10%.

Nvidia braced for a record $600 billion market value loss in a single day, surpassing its previous record from last September. The emergence of DeepSeek's economical AI assistant, now top-rated on Apple's App Store, has intensified investor scrutiny regarding the future demand for U.S.-centric AI technology.

While other tech titans like Microsoft and Alphabet also faced downturns, market volatility peaked with the Cboe Volatility Index hitting its highest level since December. Upcoming earnings reports and Federal Reserve decisions keep investors on edge amidst global economic negotiations.

(With inputs from agencies.)