DeepSeek AI Model Disrupts Global Tech Markets

The rise of Chinese AI startup DeepSeek has caused significant turmoil in global markets, particularly impacting technology stocks such as Nvidia, which experienced a record one-day loss of 17% in market value. DeepSeek's low-cost AI model has challenged the dominance of established US AI firms, leading to widespread sell-offs across tech sectors in the US, Japan, and other regions. This development has raised concerns over the sustainability of high spending in AI, especially for companies reliant on Nvidia's GPUs. While the Hang Seng index in Hong Kong saw gains due to speculation of global funds shifting from expensive US tech stocks, other Asian markets experienced declines. Investors have shifted towards safer investments like bonds, and skepticism remains about the long-term impact of DeepSeek's entry into the AI market. The situation is being viewed as a wake-up call for Silicon Valley, highlighting the potential vulnerabilities of overvalued tech stocks.