Global Tech Stocks Fall as China’s DeepSeek Triggers AI Race Debate

Singapore : Japanese tech stocks faced a significant downturn on Tuesday, as a global market rout, sparked by the emergence of DeepSeek’s low-cost AI model from China, continued into its second day. The launch of the free AI assistant by the Chinese startup raised questions over the valuations and market dominance of established AI leaders like Nvidia.
Nvidia, a leading company in the AI space, saw its shares plummet by 17%, erasing a staggering $593 billion from its market value in a record one-day loss. DeepSeek’s AI model, which uses less data and comes at a fraction of the cost of current services, gained international attention, although it has been met with some skepticism.

OpenAI CEO Sam Altman, the head of ChatGPT, acknowledged the impressive nature of DeepSeek’s model, but maintained confidence that OpenAI would continue to deliver superior models in the future. This news prompted a wave of tech stock sell-offs, particularly in Tokyo, while markets in South Korea and Taiwan remain closed for the Lunar New Year.