DeepSeek Panic Live Updates: Nasdaq Suffers Worst Day Of 2025—As Ultra-Rich, Nvidia Lose Billions
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Unveiling the Impact of DeepSeek: A New AI Era
The Challenge to American AI Dominance
The release of DeepSeek's low-cost advanced reasoning model has sent shockwaves through the U.S. tech industry, particularly affecting Nvidia, a Silicon Valley giant that designs semiconductors used in AI development.
President Trump's Stance and Potential Restrictions
President Trump is considering further export control restrictions on Nvidia's semiconductor chip sales to China, according to a Bloomberg report, raising concerns about potential impacts on AI advancement.
"It's got to end," said Howard Lutnick, Trump's pick for Commerce Secretary, referring to DeepSeek's use of Nvidia's technology.
Nvidia's Volatile Week
Nvidia's stock experienced significant volatility this week, with losses and gains alternating rapidly. Despite a historic comeback on Wednesday, the company's market value declined by $590 billion on Monday.
By Tuesday, the market capitalization had recovered by $260 billion, but Wednesday morning saw another $160 billion drop.
Market Reactions and Expert Opinions
Wall Street analysts still view the selloff as an overreaction, with Bank of America analysts expressing optimism for Nvidia's stock.
"We view the recent selloff as an enhanced buy opportunity," they wrote.
However, Morgan Stanley analyst Joseph Moore offered a more negative perspective, reducing his price target for Nvidia due to potential export control restrictions and reduced spending enthusiasm.
AI Race and International Competition
The DeepSeek development has ignited concerns about the competitiveness of U.S. AI companies in the face of rising global rivals like China.
"The AI race will be very competitive," said David Sacks, Trump's "AI & Crypto Czar," emphasizing the need for U.S. innovation.
Implications for U.S. Equities and Economic Leadership
DeepSeek's potential to revolutionize AI development comes at a time when American equities trade at historical highs.
"DeepSeek is bad news... with plans to dominate the AI market with their expensive AI services," said Ed Yardeni, founder of Yardeni Research.
The AI revolution had boosted U.S. stock leadership globally, but DeepSeek's emergence raises questions about the sustainability of that dominance.
Next Steps: Earnings Reports and Market Performance
The coming week will be crucial for Big Tech stocks, with Meta, Microsoft, and Tesla reporting earnings and Apple expected to follow next week.
Investors will be closely watching these reports for further indications of the impact of DeepSeek on the AI landscape and the broader tech industry.