By dubailife 
Nvidia Stock Crashes as DeepSeek AI Disrupts the Market
The AI race just got intense, and it’s shaking up Wall Street in a big way. Nvidia, the chipmaking giant, saw its stock plummet nearly 17% on Monday, wiping out a staggering $593 billion in market value—the biggest one-day loss in history.
The reason? DeepSeek AI—a Chinese startup that’s making serious waves in the AI world—has launched an ultra-efficient, cost-effective AI model that’s turning heads everywhere.
DeepSeek AI: A Game-Changer?
Last week, DeepSeek unveiled a free AI assistant that promises high performance at a fraction of the cost of its Western counterparts. By Monday, it had overtaken OpenAI’s ChatGPT in downloads on Apple’s App Store—a clear sign that users are taking notice.
Investors fear that DeepSeek’s low-cost AI models could shake up the entire AI ecosystem, reducing demand for Nvidia’s high-end chips. That uncertainty triggered a massive selloff, dragging down not just Nvidia but also other tech giants:
- Broadcom Inc. fell 17.4%
- Microsoft, a major backer of ChatGPT, dropped 2.1%
- Alphabet (Google’s parent company) declined 4.2%
- The Philadelphia Semiconductor Index tumbled 9.2%—its worst drop since March 2020
Even SoftBank in Japan and ASML in Europe took hits, showing how DeepSeek’s rise is sending shockwaves across global markets.
Why is Nvidia Feeling the Heat?
For years, Nvidia has dominated the AI chip market, powering everything from ChatGPT to Google Gemini with its high-performance GPUs. But DeepSeek’s cutting-edge models are raising tough questions:
- If AI models can run efficiently on fewer, lower-cost chips, will demand for Nvidia’s expensive hardware decline?
- Could DeepSeek disrupt the AI boom that has driven tech stock gains over the past two years?
- Will the AI market shift from costly data centers to mobile-friendly, energy-efficient solutions?
These concerns rattled investors, leading to the record-breaking selloff in Nvidia stock.
A “Sputnik Moment” for AI?
Tech experts are already calling DeepSeek’s rise a historic moment. Marc Andreessen, the Silicon Valley venture capitalist, went as far as to label it AI’s “Sputnik moment”—comparing it to the Soviet Union’s space race breakthrough in the 1950s.
Andreessen praised DeepSeek-R1, calling it one of the most impressive AI breakthroughs ever and a “profound gift to the world”—especially since it’s open-source.
Even Silicon Valley insiders have showered DeepSeek’s models with praise. Some analysts believe its DeepSeek-V3 model, trained using Nvidia’s lower-cost H800 chips, shows how AI models can be trained efficiently without breaking the bank.
Should Investors Panic?
Not everyone is convinced that Nvidia’s downfall is imminent.
Daniel Morgan, a senior portfolio manager at Synovus Trust Company, which owns nearly a million Nvidia shares, believes Monday’s selloff was an overreaction.
His argument? DeepSeek is competing with ChatGPT, not Nvidia’s core business.
- DeepSeek’s models are built for mobile devices and PCs, while Nvidia dominates the AI chip market for data centers—where the biggest money is made.
- Nvidia still plays a critical role in AI infrastructure, supplying high-performance chips to OpenAI, Meta, and Google.
- AI demand is skyrocketing, and Nvidia’s chips remain essential for large-scale AI operations.
He sees the current dip as an opportunity to buy high-quality tech stocks at a discount.
What’s Next for AI & Tech Stocks?
Monday’s market crash shows how AI is evolving fast, and big players like Nvidia are no longer untouchable.
With DeepSeek proving that AI can be cheaper and more efficient, the race for AI dominance is heating up. Investors and tech giants will now have to adapt to this new reality—or risk being left behind.
As AI continues to reshape the world, one thing is clear: this is just the beginning. 
Source : Khaleejtimes