Stock market crashes

 

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Severe crash on Wall Street – concerns about Chinese Deepseek

Oskar Forsberg

Updated 17.15 | Published 15.32

The Chinese AI company Deepseek is shaking up the stock market. Photo: Skjermbilde / NTB

The New York stock market opened today with significant red numbers.

The Nasdaq was down three percent.

Concerns over the Chinese AI app Deepseek are behind the panic.

The New York stock market opened today with significant red numbers. The Nasdaq was down three percent.

One of the reasons is the concern over the Chinese Deepseek that has shaken up tech companies. Deepseek has launched AI models that are said to outperform competitors in the US.

The price drops are really substantial. Not least for Nvidia.

Race for tech stocks and AI companies

But also for Swedish companies with connections to AI investments – such as Munters, Atlas Copco and ABB.

Nvidia shares fell like a rock and opened down 13 percent.

Semiconductor company Broadcom also fell sharply.

Facebook owner Meta and Amazon fell about 3 percent, software giant Microsoft 3.5 percent, Google owner Alphabet 3.3 percent and electric car giant Tesla about 2 percent.

The Dow Jones industrial average had fallen 0.2 percent and the broad S&P 500 index 1.6 percent at the opening.

The New York stock exchanges opened in the red on Monday. Photo: Peter Morgan / AP

Escalation of the “tech war”

Lars Söderfjell, head of equities at the Bank of Åland, is doubtful whether Deepseek will be able to establish itself on a broad front in the West.

Not least given the imminent risk that the Trump administration could escalate the "tech war" between the US and China with some type of ban on Deepseek in the US - the same kind that TikTok has suffered.

- And many IT departments will probably block Deepseek's app on their own when they realize what this is, Söderfjell tells TT.

Reflex from the market

Söderfjell describes the sharp price declines for Nvidia and other AI stocks as a reflex - perhaps exaggerated.

The market is ducking as something has been discovered that can quickly change the highly inflated valuations of AI stocks in the West and that paves the way for substantial price pressure in the sector.
 

FACTS

Deepseek

Chinese AI company Deepseek, which has been described as at least as good as, for example, the chatbot Chat GPT, but at a significantly lower cost and with fewer advanced data chips.

Deepseek has thus called into question the entire American tech sector's lead.

Source: TT