On Monday, tech stocks faced a significant decline, with the Invesco QQQ Trust down 3.1%. Investor sentiment turned negative following the release of a cheaper AI model from Chinese startup DeepSeek, leading to concerns over the high valuations of U.S.-listed tech companies, especially the Magnificent Seven. Nvidia suffered the largest losses among these stocks, down over 17%, amid worries about slowing AI chip demand. Meanwhile, some stocks like Apple and Meta showed modest gains, while major indexes also recorded losses, indicating a widespread correction in the tech sector.
The DeepSeek news is clearly likely to put pressure on semiconductor stocks today and perhaps in coming days, till there is more clarity on its potential impact on AI chip demand.
Nvidia is the biggest loser of the Magnificent Seven, down over 17%. Fears are growing that spending on AI chips designed by Nvidia will slow.
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