Nvidia, ASML Stocks Plunge Amid DeepSeek AI Competition

Shares of major tech companies Nvidia and ASML fell significantly following the launch of Chinese startup DeepSeek's new AI model, which reportedly performs at a level comparable to ChatGPT while operating on less advanced, cost-effective chips. Nvidia's stock dropped about 11%, and ASML experienced an 11.7% decline, raising concerns about the overvaluation of these companies amidst increasing competition. DeepSeek's model, which became the top-rated app in the Apple Store, has sparked discussions about the sustainability of current AI business models that heavily rely on expensive hardware. Analysts are questioning the future of tech giants like Nvidia and Meta as DeepSeek demonstrates the potential for effective AI solutions without the high costs typically associated with advanced chip technology. This downturn also contributed to a 5.2% drop in Nasdaq 100 futures, marking the largest intraday decline since August. The situation indicates a shift in the AI landscape, emphasizing the need for established companies to adapt to emerging competitors offering more efficient solutions.