Recently, a low-cost artificial intelligence (AI) model launched by the Chinese startup DeepSeek quickly went viral, causing significant turbulence in global capital markets. This "mysterious force from the East" has disrupted the existing structure of the AI industry, leading to a plunge in U.S. tech stocks and triggering market panic.
According to market data, the USD/THB exchange rate rose by 0.9% over the past two days, indicating that investors are reassessing the risks associated with AI-related assets. The Nasdaq Index fell by 3.1% on Monday, with technology stocks hit the hardest. Nvidia's stock plummeted nearly 17%, wiping out approximately $600 billion in market value, marking the largest single-day market value loss in U.S. stock history. The Philadelphia Semiconductor Index (SOX) also tumbled 9.2%, recording its biggest drop since March 2020.
Wall Street's "fear index," the VIX, soared above 18, highlighting the market's risk aversion. Market analysts believe that DeepSeek's rise challenges existing AI giants' business models, which typically rely on high-end chips and powerful computing capabilities. A report from Jefferies analysts noted, "This could upend the current AI business model and have profound effects on the chip industry."
Meanwhile, other global markets were also affected. Japan's SoftBank Group fell 8.3%, and European chip giant ASML's stock dropped by 7%. Investors flocked to government bonds and safe-haven currencies, driving the yield on the U.S. 10-year Treasury bond down to 4.53%, while the yen and Swiss franc appreciated against the dollar. Oil and gold prices also experienced volatility, with WTI crude oil plunging 3% during the session and gold prices dropping 1%, though still near historical highs.
DeepSeek's AI Innovation Shakes Industry
DeepSeek was founded in 2023 by Liang Wenfeng, CEO of High-Flyer. The company's AI model was released as open-source, drawing significant attention from developers. Its R1 version rivals OpenAI's latest model, quickly gaining market acceptance. In early January, the mobile app launched by DeepSeek topped the U.S. iPhone download charts, becoming a dark horse in the AI field.
On January 27, DeepSeek further launched a series of open-source multimodal AI models called Janus-Pro and JanusFlow. Janus-Pro significantly improved adaptability and performance for different tasks through decoupling visual encoding, while JanusFlow combined generative flow and autoregressive language models, excelling in comprehension tasks and generating high-quality images, demonstrating the framework's simplicity and power.
Market Reassesses the Landscape in the AI Field
Chris Larkin, Director of Trading and Investment Management at Morgan Stanley, stated that DeepSeek's emergence makes this week's tech stock earnings season even more crucial. Companies like Microsoft and Apple need strong performance to restore market confidence. However, strategists at BlackRock Investment Institute warned that the profitability of high-valuation tech stocks is being questioned by investors, raising doubts about whether large-scale capital investment in AI will yield expected returns.
Market experts widely believe that DeepSeek's rise presents new challenges and opportunities for the AI industry. In the short term, this impact may exacerbate market volatility, but in the long run, it could drive further innovation and development in AI technology.
