U.S. Tech Stocks Pummeled As Cheaper Chinese AI Model Gains Traction
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deadline.comThe Nasdaq dropped like a stone Monday as tech stocks, inflated for the past year by the promise of artificial intelligence, took a dive.
The trigger was Chinese company DeepSeek, which last week rolled out a product similar to U.S. AI giants but using less powerful and much cheaper chips.
DeepSeek claims that it spent $5.6 million to train its latest model that rivals OpenAI’s ChatGPT and Meta’s Llama and was no.
1 on Apple’s App Store over the weekend. That wreaked havoc on the tech-heavy Nasdaq, down more than 3% in mid-afternoon trading, on investor fears of increased competition risk even as U.S players are spending billions on AI investment.
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