NVIDIA Faces Historic Market Cap Loss Amid DeepSeek AI Competition

NVIDIA Corporation witnessed a dramatic sell-off on Monday following concerns over Chinese AI startup DeepSeek's low-cost, competitive AI model. The stock opened at $124.80 per share on the NASDAQ and hit an intraday low of $116.70, closing 17% lower.

This unprecedented dip led to NVIDIA losing over $600 billion in market capitalization, marking the largest single-day loss for any company in market history. Analysts attribute this downturn to investor fears over the disruptive potential of DeepSeek’s AI technology, which challenges the market dominance of established players like NVIDIA, OpenAI, and Meta.

Anshul Jain, Head of Research at Lakshmishree Investment and Securities, said, “DeepSeek’s latest innovation has created uncertainty among global investors, leading to a broad sell-off in tech stocks.”

The ripple effect extended to the Asian stock market on Tuesday, as chip-related stocks in Japan and other markets followed suit, reflecting investor concerns over the long-term viability of high valuations in the AI sector.

Market experts suggest caution for NVIDIA shareholders, recommending a strict stop-loss strategy and advising against bottom-fishing until the stock stabilizes.