Stock market today: Nasdaq clobbered, Nvidia sinks 17% while Dow stages comeback as AI fears shake markets

Stock market today: Nasdaq clobbered, Nvidia sinks 17% while Dow stages comeback as AI fears shake markets

One effect of this has been to cause a rise in yields on US Treasury long-term bonds, reflecting fears of further inflation. The US has been experiencing a long “bull” stock market, that is rapid growth in stock prices, although this week tech stocks tumbled over the future prospects for US-built AI. The shock to financial markets came from China, where a company called DeepSeek unveiled a large language model that can compete with U.S. giants but at potentially a fraction of the cost. Nvidia lost nearly $600 billion in market value Monday as tech stocks plunged amid fears that Chinese artificial intelligence firm DeepSeek leapfrogged U.S. dominance in AI development. In stock markets abroad, movements for broad indexes across Europe and Asia weren’t as forceful as for the big U.S. tech stocks. Stocks edged 0.1% lower in Shanghai after a survey of manufacturers showed export orders dowmarkets in China dropping to a five-month low.

• Losses deepened on Monday as Nvidia (NVDA), a key player in the AI sector, saw a dramatic 17% drop, leading a broader market sell-off.
• There are no fixed times for reviewing the composition of the index, since changes are only made by the commission as and when they are needed.
• Siemens Energy, which makes equipment for utility companies, plunged 20%.
• U.S. stock futures are lower to close out the final full trading week of the year.
• The company has said it would restart the shuttered Three Mile Island nuclear power plant to supply power for data centers for Microsoft.
• Many investors are currently quite nervous about a possible recession after the long bull market of the last few years.

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DeepSeek’s training costs amounted to just $5.6 million, compared to the more than $100 million spent on OpenAI’s GPT, raising concerns about the financial viability of AI investments moving forward. Giuseppe Sette, a president at AI market research firm Reflexivity, said the underlying tech for DeepSeek appears to be “extremely bullish in the long-term” because it could be a playbook for other AI firms going forward. Mega-cap tech firms also felt the pain, with Microsoft falling 2% and Google parent, Alphabet, falling 4%. Meta Platforms, which is developing its own open-source AI model, fell earlier in the day but ended higher by 1.9%.

NYSE Chicago

So, it would be well worth Trump studying the history of US stock markets rises and falls, if he wants to avoid a severe economic downturn during his second term. Shiller’s data makes it possible to look at the relationship between who is the president and stock prices since 1925. By examining the performance of the stock market over that period we can identify the extent to which eight Democrat and nine Republican presidents have influenced the growth of the market. The drop comes amid growing concerns over a potential stock bubble tied to artificial intelligence. The catalyst for the sell-off is the recent success of DeepSeek, a Chinese AI startup that has raised questions about the sector’s future investment needs.

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• Eyes will be on guidance for future profit as DeepSeek raises questions about prospects for revenue.
• DeepSeek, a Chinese artificial intelligence tool, has become one of the most popular apps in the U.S., beating the chatbot from American firm OpenAI.
• Nvidia said in a statement that “DeepSeek is an excellent AI advancement” and an example of what is possible, “leveraging widely available models and compute that is fully export control compliant.”
• Yields have been on the rise amid a solid U.S. economy and worries about possibly higher inflation coming from tariffs and other policies favored by President Donald Trump.
• DeepSeek’s rise threatens to disrupt the global technology landscape, challenging the dominance of U.S. firms in the field.
• He would have been impeached by Congress had he not resigned in August 1974 following the revelations of the Watergate scandal.

The sharp decline follows concerns about DeepSeek, a Chinese startup’s large language model, which has sparked a global sell-off in tech stocks. Get the latest updates on US markets, world markets, stock quotes, crypto, commodities and currencies. Oracle and SoftBank, which were part of a $500 billion deal President Donald Trump announced last week to build more AI infrastructure, also dropped. Oracle shares were down as much as 9%, while SoftBank shares were down 8% after Tokyo’s stock exchange closed on Monday.

Eyes on Nvidia rout

However, long term trends in the US stock market reveal a pattern suggesting that stock prices might be quite vulnerable during his second term. The Nasdaq and S&P 500 were rattled by claims by China’s DeepSeek that its AI assistant uses cheaper chips and less data than leading models, but performs equally well. A surge in DeepSeek’s popularity has spurred investors to question bets that AI demand-driven growth will keep fueling gains for stocks. Every weekday afternoon, get a snapshot of global markets, along with key company, economic, and world news of the day. Beyond the single-day moves in the tech space, the emergence of China’s DeepSeek startup is challenging the very foundation of the record-setting stock market. The sell-off has ensnared megacap giants such as Nvidia and Microsoft, which are heavily weighted in US indexes.

Chinese startup DeepSeek has sparked a shake-up in the AI industry with the launch of its latest models, which it claims rival or exceed the performance of leading U.S. models at a fraction of the cost. DeepSeek’s AI Assistant, powered by its DeepSeek-V3 model, has already overtaken ChatGPT as the top-rated free app on the U.S. The selloff in AI-linked stocks comes after the rise of DeepSeek, a Chinese AI startup that has drawn attention for offering a competitive, lower-cost alternative to Microsoft-backed OpenAI’s ChatGPT.

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Although it’s unclear how much High-Flyer has invested in DeepSeek, the hedge fund’s presence in the same office building as DeepSeek and ownership of patents related to AI chip clusters suggest a close partnership. High-Flyer’s AI unit reported owning a cluster of 10,000 A100 chips as of July 2022, further solidifying its commitment to advancing AI technology. The release came just a month after DeepSeek announced that training its latest AI model cost a fraction of what OpenAI spent on its GPT model.

Eyes will be on guidance for future profit as DeepSeek raises questions about prospects for revenue. The Nasdaq tanked on Monday as a Chinese startup rattled faith in US leadership and profitability in AI, taking a hammer to Nvidia (NVDA), wiping out a record $589 billion in market value. Information is provided ‘as is’ and solely for informational purposes, not for trading purposes or advice. For exchange delays and terms of use, please read disclaimer (will open in new tab). We asked some of the most curious minds in life sciences and healthcare to share thoughts on their careers, the future of health and more.

At least investors will soon get to grill Big Tech companies about DeepSeek and their overall AI strategies. Four of what are often dubbed the Magnificent Seven tech stocks — Meta, Apple, Microsoft and Tesla — are due to report quarterly results this week. Constellation Energy, which inked a deal with Microsoft to restart the Three Mile Island nuclear plant to power artificial intelligence servers, sank 20%. Shares of other power companies seen as AI beneficiaries such as Vistra Energy and NRG Energy also dropped sharply. Siemens Energy, which makes equipment for utility companies, plunged 20%. The sell-off was sparked by advances claimed by China’s DeepSeek, whose outstanding qualities became evident this weekend.

NYSE

Shares of Nvidia, the chip company whose AI technology has made it into one of the world’s most valuable companies, dropped more than 13% by late morning on Monday. Rival chip companies, including Arm and Broadcom, also plunged, dragging down the major indexes. The tech-heavy Nasdaq fell almost 600 points, or nearly 3%, by late morning. Many investors are currently quite nervous about a possible recession after the long bull market of the last few years.

There are no fixed times for reviewing the composition of the index, since changes are only made by the commission as and when they are needed. Like the Swiss Market Index (SMI), the Dow Jones is a price index. The shares included in it are weighted according to price; the index level represents the average of the shares included in it. Nvidia stock shed 17% on Monday and erased $589 billion from its market cap, the worst single-day loss of market value ever amid panic over DeepSeek. “DeepSeek is a word you’ve heard all weekend, and you’ll hear all day today,” Jeff Kilburg, the CEO of KKM Financial, told CNBC on Monday.

The open-source model was first released in December, when the company said it took only two months and less than $6 million to create. The third crash occurred in December 2007 when George W Bush was the president. It had its origins in the deregulation of the financial sector which had occurred in the US after Ronald Reagan became president in 1980. Lax financial regulations led to ever increasingly risky assets and trading practices on Wall Street starting in the real estate market. AGI, as defined by OpenAI, refers to autonomous systems that outperform humans in most economically valuable tasks.