The rising popularity of Chinese generative artificial intelligence (AI) startup DeepSeek has been impacting the US stock market, causing it to shrink. The hype around DeepSeek crashed many technology stocks overnight, and the wealth of Silicon Valley’s rich elites also plummeted.
Deepseek AI Sends Shockwaves through US Socks, Silicon Valley Elites
Oracle Chairman Ellison’s net worth fell by US$27.6 billion, former Microsoft executive Steve Ballmer’s net worth shrunk by US$2.1 billion, and Nvidia CEO Huang Renxun’s net worth decreased by about US$20 billion.
Apple, Meta and Amazon are the stocks among the “7 giants of US tech stocks” that have withstood the market crash. On January 27, Apple (APPL) reportedly closed up 3.18%, Meta Platforms (META) closed up 1.91%, and Amazon closed up 0.24%. At the same time, the share price of chipmaker Nvidia (NVDA) closed down nearly 17% on January 27, and its market value evaporated by nearly $600 billion, which is the largest single-day market value drop in the history of the US stock market.
According to TradingView data, the share price of Google’s parent company Alphabet Inc (GOOG) was also hit hard, falling 4%, while Microsoft Corporation (MSFT) and Tesla Inc (TSLA) fell 2.14% and 2.32%, respectively.
Nvidia, a dominant player in the computer infrastructure market, was shaken after news spread about DeepSeek’s integration of highly cost-effective chips. Although Nvidia’s shares in Frankfurt, Germany, later rose by 5.7%, the initial shock had already prompted Silicon Valley founders to reconsider the cost of AI production, especially after DeepSeek’s V3 large language model (LLM) was seen outperforming several US based LLMs
DeepSeek’s affordability even drew admiration from Donald Trump, who praised the Chinese AI innovation but also warned U.S. tech firms to focus on competition. He described DeepSeek’s meteoric rise as a wake-up call for American technology companies.
Also Read: DeepSeek AI Tops US App Store, Sparks Stock Index Futures Drop
