US Tech Stocks Plunge Over China AI Company DeepSeek

U.S. tech stocks dropped sharply in pre-market trading on Monday due to concerns over advances by a small Chinese technology firm's possible impact on established artificial intelligence-related companies.

The tech-heavy Nasdaq stock market was down more than 800 points ahead of the opening bell.

Nvidia, which has become one of the largest-valued companies due to its AI chips, dropped more than 10% in overnight trading.

Investors were reacting to growing knowledge about DeepSeek's newest AI model being cost-effective while running on less advanced chips, Bloomberg reported.

The new model is expected to be competitive with OpenAI and Meta.

DeepSeek's AI Assistant offering had grown to be the top free download in the Apple App Store, leapfrogging ChatGPT.