DeepSeek AI Launch Disrupts Global Tech Market Dynamics

Chinese startup DeepSeek has shaken the AI industry by launching advanced models comparable to those from leading US firms like OpenAI, but at significantly lower costs, causing a massive selloff in technology stocks, including Nvidia, which saw its market value drop by nearly $600 billion. DeepSeek's AI models, trained using less expensive chips, have challenged the prevailing notion that advanced AI requires costly infrastructure, leading to doubts about future demand for high-priced US AI technology. The startup's rapid success, including becoming the top-downloaded app on Apple's platform, has prompted fears of increased competition and reduced growth prospects for US tech companies and affected power producers like Vistra and Constellation Energy, which were banking on AI-driven growth. Despite the market turmoil, some tech stocks rebounded slightly in premarket trading, as industry figures and companies like Nvidia recognized DeepSeek's advancements as a potential shift towards more accessible AI technology. The geopolitical implications are profound, as DeepSeek's rise highlights China's potential to close the AI gap with the US, despite export restrictions on advanced chips.