Chinese AI DeepSeek is disrupting financial markets
The surprise arrival of the AI DeepSeek, a Chinese product, has caused a significant upheaval in global financial markets.
Anxiety about China's DeepSeek sent US stocks tumbling, with Nvidia plunging 13%, the Nasdaq 100 down 3.6% and the S&P 500 falling 2.3%
DeepSeek-R1 is an open source reasoning model that introduces a logical chain allowing for requests to be processed in successive steps, enhancing the deductive and analytical capabilities of the AI.
This model, offering high performance, now competes with GPT-4 and challenges the monopoly of American companies like OpenAI, Nvidia, Microsoft Copilot, XAI, Google Gemini, Anthropic, and Meta.
Microsoft’s stocks, the developer of AI Copilot, fell by $15.94 (-3.59%) at the market opening, while Google’s stocks, creator of AI Gemini, dropped by $5.05 (-2.50%). Alphabet Inc. (GOOGL) also recorded a decrease in its market value of $5.63 (-2.81%). For its part, NVIDIA, known for its advanced AI model optimized for high-performance computing thanks to its leading GPUs, experienced a significant drop with a decline of $20.94 (-14.68%).
Overall, the Nasdaq Composite, representing the largest tech companies, recorded a drop of 3.4%, while the Dow Jones Industrial Average saw a more moderate decline of around 0.4%. Meanwhile, the S&P 500 fell by nearly 2%.
This situation clearly reflects the concerns of investors in an economic context destabilized by the arrival of a new competitor in the market.