Stock market today: Nasdaq tanks, Dow tumbles 350 points as AI fears rock tech stocks

Published On Jan 27, 2025, 9:36 AM

The Nasdaq experienced a significant decline of approximately 3.5% on Monday, driven by concerns regarding the competitive future of U.S. artificial intelligence following revelations about a Chinese AI startup, DeepSeek. This company claims to have developed an AI assistant that performs comparably to leading models from companies like OpenAI and Meta but utilizes less data and cheaper chips. This sparked fears about valuations in the tech sector, primarily affecting stocks like Nvidia, which fell over 11%. Other major tech companies such as ASML, Arm, Broadcom, and Micron also suffered losses. Analysts suggest that while the claims made by DeepSeek are noteworthy, the overall market reactions might be exaggerated, and they remain confident about the resilience of established players in the AI field. Additionally, investor sentiment has been influenced by the potential for renewed U.S. tariffs under President Trump, which adds to economic uncertainty.