Global technology shares showed signs of recovery on Tuesday following a massive selloff triggered by the launch of a low-cost Chinese AI model. DeepSeek, a startup from Hangzhou, introduced an AI assistant that uses less data and costs significantly less to develop, raising questions about the dominance and valuations of established AI leaders. Nvidia, a key player in the AI boom, saw its stock plunge 17 per cent on Monday, erasing $593 billion in market value — the largest one-day loss for any company. By Tuesday, Nvidia shares rebounded 6 per cent in Frankfurt. Similarly, Oracle and Palantir gained 3.4 per cent and 3 per cent, respectively. The selloff extended globally, with Japanese chipmaker Advantest dropping 10 per cent and US tech stocks like Microsoft and Alphabet also posting significant losses. Analysts warn that high valuations leave little room for error as the AI sector faces new competition. DeepSeek's model, trained using Nvidia's H800 chips for under $6 million, has flipped the narrative of US dominance in AI. The development drew praise from OpenAI CEO Sam Altman and prompted global scrutiny, with Japan's digital minister Masaaki Taira acknowledging its potential to reshape the AI landscape. Attribution: Amwal Al Ghad English Subediting: Y.Yasser
