What is DeepSeek, and why is it causing Nvidia and other stocks to slump?
CBSN
A Chinese artificial intelligence company called DeepSeek is grabbing America's attention — and sending a shock wave through Wall Street — due to its new tech, which some experts say rivals that of OpenAI's ChatGPT.
DeepSeek is also catching investors off guard because of the low development costs for its AI app, which Wedbush Securities analyst Dan Ives pegged at only $6 million. By comparison, OpenAI, Google and other major U.S. companies are on track to invest a total of roughly $1 trillion in AI over the coming years, according to Goldman Sachs.
On Monday, DeepSeek's rollout roiled shares of AI stalwarts such as Nvidia, the high-flying manufacturer of advanced chips engineered for AI development, and Dutch company ASML, another chipmaker. The Chinese company's tech is raising questions about whether demand for Nvidia's chips could take a hit, as well as whether investors are overvaluing tech stocks that have been buoyed by the promise of AI, from Meta to Microsoft, experts said.
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