Most major stock exchanges in the United States closed Monday's trading session with losses primarily fueled by investor concerns over a new, cost-effective artificial intelligence model developed in China. The introduction of this model has raised fears about its potential impact on established AI giants like Nvidia. The Chinese startup DeepSeek unveiled its free AI assistant the previous week, boasting that it operates with minimal data usage and significantly reduced costs compared to existing services. By Monday, this AI assistant had surpassed the US-based ChatGPT in terms of downloads among iOS users.
The Nasdaq 100 nosedived 2.97% or 646 points at 4:00 pm ET, with Constellation Energy Corporation falling 20.85% and Broadcom Inc. dipping 17.40%. The S&P 500 declined 1.46%. The worst performer was Vistra Corp., whose shares nosedived 28.27%. A minute later, the Dow Jones added 0.65% or 289 points with Johnson and Johnson adding 4.15%.
The euro was flat against the dollar at 3:58 pm ET, going for 1.04892.