The Nasdaq has dropped 3.5%, falling below 20,000 to around 19,250, primarily due to rising fears surrounding the Chinese AI startup DeepSeek's new model, DeepSeek-R1. Since its recent release, DeepSeek-R1 has quickly surpassed ChatGPT in popularity, prompting bearish sentiment in the tech sector. Major companies like Nvidia, Broadcom, and Microsoft are experiencing significant stock declines, attributed to concerns that DeepSeek’s breakthroughs may reduce demand for their AI-related products. Analysts are now questioning the sustainability of stock values dependent on AI growth, leading to a broader market retreat.
The current situation in the tech market, particularly for giants like Nvidia and Broadcom, is dire, with stocks down significantly amid fears over DeepSeek-R1's impact.
DeepSeek-R1's rapid popularity has raised alarms on Wall Street, leading to a dramatic pullback in key tech stocks as investors reassess their strategies.
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