Nvidia and US futures show signs of recovery after DeepSeek tech wipeout erased more than $1 trillion from markets
Nvidia CEO Jensen Huang’s net worth fell from $121 billion to about $100 billion on Monday, the Bloomberg Billionaires Index estimated.
US stock futures steadied on Tuesday morning after a dramatic sell-off on Monday triggered by concerns over the Chinese AI firm DeepSeek.
Nasdaq 100 futures were up 0.6% just before 6:30 a.m. ET, while S&P 500 futures climbed by 0.3%. Dow Jones Industrial Average futures were up 0.1%.
Nvidia was up 5.3% in premarket trading on Tuesday, a sign of cautious recovery. Jensen Huang’s AI-chip maker plunged 17% the previous day — the biggest single-day drop for a US company. Huang’s personal net worth fell from $121 billion to about $100 billion amid the sell-off, the Bloomberg Billionaires Index estimated.
Its fellow US tech giants Broadcom and Oracle also recovered from dramatic declines, rising in premarket trading by 3.9% and 3.2%, respectively.
On Monday, global stocks plummeted as traders fled the tech sector over concerns about DeepSeek’s impressive and cheap capabilities and their implications for the US’s high-spend strategy on artificial intelligence.
The S&P 500 closed nearly 1.5% lower, while the tech-heavy Nasdaq Composite shed over 3% by the end of the day. More than $1 trillion in market capitalization was erased from US stocks.
“Valuations have been getting lofty in the tech space and investors need to appreciate that richly priced stocks can fall hard on the slightest bit of bad news,” said Russ Mould, investment director at AJ Bell.
The DeepSeek model impressed the tech community and will have a ripple impact, Dan Ives of Wedbush Securities wrote in a morning note, but said that DeepSeek is “not launching 100x the capacity/algorithms that is needed to even consider this a competitive threat in our view.”
“No US Global 2000 is going to use a Chinese startup DeepSeek to launch their AI infrastructure and use cases. At the end of the day there is only one chip company in the world launching autonomous, robotics, and broader AI use cases and that is Nvidia,” Ives said.
