A new AI chatbot called Deep Seek created by Chinese investors has been released and sent shock waves through the US AI industry because it seems to be able to do all that the other chatbots can do (and perhaps more) for much lower cost and with less sophisticated chips.
Investors punished global tech stocks on Monday after the emergence of a Chinese chatbot competitor to OpenAI’s ChatGPT, DeepSeek, raised doubts about the sustainability of the US artificial intelligence boom.
The tech-heavy Nasdaq index in New York opened lower after investors digested the implications of the latest AI model developed by the startup DeepSeek.
Nvidia, the most valuable listed company in the US and a leading maker of the computer chips that power AI models, lost more than $400bn (£321bn) in stock market value in early trading as its shares declined 13.6%, while Microsoft shed $130bn and Google’s parent, Alphabet, declined by $80bn.
Nvidia’s fall – which wiped about $465bn off its value, was the biggest in US stock market history, according to Bloomberg.
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