Closing summary
A sell-off of global technology shares has wiped up to $1 trillion off US stock markets, with the US chipmaker Nvidia falling more than 13%, and losing $465bn off its market value – the biggest such loss in US market history.
The popularity of a new Chinese AI app from the start-up DeepSeek, which has called US dominance into question, is behind the rout.
US markets have recouped some of their losses and the Nasdaq is now down by 2.65% after tumbling by 3.53% at the open, or 704 points, to 19,250.
Over here, the UK’s FTSE 100 index is now slightly positive at 8,507 while the pan-European Stoxx 600 is also just in positive territory. Germany’s Dax is down 0.3% while the CAC in Franc is just negative and the Italian borsa is up by 0.1%.
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Thank you for reading. Take care! – JK
The DeepSeek AI threat has wiped up to $1 trillion of US stock markets, noted Axel Rudolph, senior technical analyst at online trading platform IG.
The Nasdaq 100’s near 4% and S&P 500 over 2% pre-market drop, following China’s DeepSeek R1 AI, which surpassed ChatGPT as the top free app on the US App Store and apparently cost less than $6m to develop, made investors question lofty US tech valuations.
Nvidia shares sank by 13%, erasing $465bn in market value. Falling US Treasury yields and bargain hunters helped US indices recover with the Dow flatlining, S&P 500 trading less than 1.5% lower and Nasdaq down less than 2.5% in the end.
European indices were mixed, some like the FTSE 100, Italian and Spanish stock indices regained all of their Monday losses and ended up in positive territory on the day. German business morale edging up and US home sales topping expectations played second fiddle amid a day of high volatility.
