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This report comes from today's CNBC Daily Open, our International Markets Bulletin. CNBC Daily Open raises investors on everything they need to know, no matter where they are. How do you see what you see? You can subscribe Here.
What you need to know today
$ 600 billion in NVIDIA
Nvidia Actions fell on Monday by almost 17% The worst day from March 2020on the fears raised by China Deepseek, the artificial intelligence model. Chipmaker lost nearly $ 600 billion for market capitalizationThe biggest decrease for each company in one day in US history. Other AI stocks, such as MicronIN Armament AND Broadcom in the USA, as well ASML AND Tokyo Electron It also fell sharply on global markets.
Deepseek raises questions about AI investments
The Chinese startup Ai Deepseek released his own R1 reasoning modelwhich competes with O1 OpenAI. His main claim to fame is that the model was built with less powerful systems than those of AI that use and may cost less than 10% Finish Llama, according to Jefferies analysts. This disturbed the fears that huge investments in artificial intelligence by American companies are unjustified, and the bubble is waiting for pop.
Energy shares in leave
The most frequently issued energy companies Boom fell to the Data Center for the Technology Sector Data, because the Deepseeka claims led the investors to the question of how much energy will actually consume the applications of artificial intelligence. Vistur Closed almost 30% lower Speech energy AND GE Vernova fell by over 20%. All three shares gave up this year's profits.
Technical actions
Main American references He fell on Monday On wide isolation by semiconductors and AI actions, although the industrial average Dow Jones managed to advance. The Pan-European Stoxx 600 index has fallen by 0.07%, Recovering after steep losses before. But stocks with AI ties such as Siemens Energy AND Schneider ElectricHe ended a much lower day.
(PRO) NVIDIA Sale “excessive reaction”: Tom Lee
The fall of Nvidia is a “excessive reaction” on a scale similar to Pandemia sales in 2020, Tom Lee, head of research at Fundstrat Global Advisors, said CNBC. Here's why Lee For now, he does not change his opinion on Nvidia.
Lower line
Nvidia ruta, caused by the fears induced by Deepseek, that AI models do not really need expensive tokens worth billions of dollars, is deep and terrifying. There is no other way to put it.
Before Monday, the chip manufacturer was the most valuable company listed in the stock exchange. After a sale, which wiped almost $ 600 billion in the NVIDIA market capitalization, the company fell to third place Apple AND Microsoft.
To place this tectonic change in the context, the decrease in Nvidia in market capitalization is greater than the entire market value Netflix and double Wells Fargonoticed Adrian Van Hauwermeiren from CNBC.
And this is important for investors, because NVIDIA, most likely, takes place in its portfolios, considering how much the stock exchange was about profit chipmaker in the last two years. Even if investors are not exposed to NVIDIA for some reason, his shares belong to the 15 best resources of 469 stock funds, in accordance with VastnessAdded Van Hauwermeiren.
Apart from NVIDIA, other adjacent pieces fell steeply, causing the NASDAQ composite to move 3.07%. S&P 500 lost 1.46%. However, the industrial average Dow Jones, which increased by 0.65%, was slightly protected before Monday Bloodbath for the benefits of Apple, Johnson & Johnson and Travellers.
“This is a good example of selling the first and asking questions later, and investors in a sense the feeling that the valuations are slightly stretched for technology in general, and especially for semiconductors,” said Stovall himself, the main investment strategist at CFRA Research.
“We will have variability, especially when we are dealing with richly valued market and exogenous events,” added Storek.
Actually, CBEE VIX index -which measures the strength of 30-day changes in S&P prices, and therefore is perceived as a meter of fear of Wall Street-it raised on Monday by 20.5%, although it was possible to immerse as a result of 45% growth earlier on the same day.
After saying, there were still pockets on the market, on which actions grew, which suggests that “investors do not necessarily withdraw actions, but rotate to defensive areas,” as Stovell put it.
Some technological stocks increased even despite the piles of the sector throwing by Deepseek. Actions SalesforceIN Adobe AND Palo Alto Networks According to John Belton, a portfolio manager at Gabella Funds, Rose in terms of the perspective that the costs of artificial intelligence can fall and expand their margins.
In other words, Deepseek does not prove that AI is a fantastic hole in which investors and companies belong to money. On the contrary, he suggests that artificial intelligence is more accessible and affordable than they think – if Deepseek claims with its low costs are true, investors must get used to another AI game.
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