Trump cautions US firms as DeepSeek triggers a plunge in leading AI stocks
DeepSeek's impact leads to a decline in leading AI stocks as Trump issues a warning to US companies.
TroibNews 
Major US blue-chip stocks experienced a sharp decline on Monday, with the Nasdaq composite falling just over 3 percent and the S&P 500 decreasing by 1.46 percent, according to CNBC. This downturn has been linked to the impressive rise of the China-based AI chatbot DeepSeek.
Shares of AI-focused technology companies dropped significantly, with Broadcom and AMD experiencing declines of 17 and 6 percent, respectively. Most notably, shares of US chip giant Nvidia plummeted nearly 17 percent, resulting in a loss of almost $600 billion in market value in just one day.
This market volatility comes shortly after DeepSeek, developed by a Hangzhou-based company in 2023, became the most downloaded application on Apple's US app store. It is a free open-source large language model, constructed using lower-capability chips from Nvidia known as H800s. The development and training costs for DeepSeek are reported to be around $6 million by CNBC, which challenges the common perception that substantial investments in computing power are necessary for such projects.
In light of the stock price declines, a spokesperson for Nvidia remarked to Bloomberg that DeepSeek is an "excellent AI advancement", underscoring the ability of a company to produce new AI models while utilizing those that are already widely available.
During a discussion with House Republicans on Monday, US President Donald Trump characterized the news surrounding DeepSeek as "positive", emphasizing that it demonstrates how advancements can be achieved at lower costs. However, Trump also viewed it as a call to action for American businesses, stating that the development should serve as "a wake-up call for our industries that we need to be laser-focused on competing to win."
Financial sector leaders echoed similar views. Nasdaq Vice Chairman John McCoy, speaking to China Media Group, noted that "AI will continue to be one of the most important revolutions" and added that "DeepSeek is going to be an important aspect of that."
Industry experts largely agree that the success of DeepSeek represents a significant achievement in China's large model technology, while also indicating a gradual erosion of the United States' dominance in advanced AI. They advocate for international collaboration in advancing AI for the mutual benefit of the global community.
Frederick R Cook for TROIB News
Shares of AI-focused technology companies dropped significantly, with Broadcom and AMD experiencing declines of 17 and 6 percent, respectively. Most notably, shares of US chip giant Nvidia plummeted nearly 17 percent, resulting in a loss of almost $600 billion in market value in just one day.
This market volatility comes shortly after DeepSeek, developed by a Hangzhou-based company in 2023, became the most downloaded application on Apple's US app store. It is a free open-source large language model, constructed using lower-capability chips from Nvidia known as H800s. The development and training costs for DeepSeek are reported to be around $6 million by CNBC, which challenges the common perception that substantial investments in computing power are necessary for such projects.
In light of the stock price declines, a spokesperson for Nvidia remarked to Bloomberg that DeepSeek is an "excellent AI advancement", underscoring the ability of a company to produce new AI models while utilizing those that are already widely available.
During a discussion with House Republicans on Monday, US President Donald Trump characterized the news surrounding DeepSeek as "positive", emphasizing that it demonstrates how advancements can be achieved at lower costs. However, Trump also viewed it as a call to action for American businesses, stating that the development should serve as "a wake-up call for our industries that we need to be laser-focused on competing to win."
Financial sector leaders echoed similar views. Nasdaq Vice Chairman John McCoy, speaking to China Media Group, noted that "AI will continue to be one of the most important revolutions" and added that "DeepSeek is going to be an important aspect of that."
Industry experts largely agree that the success of DeepSeek represents a significant achievement in China's large model technology, while also indicating a gradual erosion of the United States' dominance in advanced AI. They advocate for international collaboration in advancing AI for the mutual benefit of the global community.
Frederick R Cook for TROIB News
