The Impact of DeepSeek on the United States

The share prices of technology giants such as NVIDIA were the most significantly affected. On January 27 local time, the share price of NVIDIA, the US chip giant, plummeted by approximately 17%, with its market value evaporating by about $590 billion, setting a record for the single - day market value loss of a US - listed company. On that day, NVIDIA's stock opened at $124.80 per share, down 12.49% significantly. Subsequently, the decline continued to widen, and at the close, it was down 16.97%. The share price of Broadcom also fell by 17%, that of AMD by 6%, and Microsoft's by 2%. The sharp decline in the share prices of these technology giants led to a single - day evaporation of $1 trillion in the market value of related high - tech sectors. Among them, NVIDIA's market value declined by 17% in a single day, with its market value evaporating nearly $600 billion, setting a record for the largest single - day decline of a company in the history of US stocks.

A Goldman Sachs report shows that with the rise of Chinese AI companies such as DeepSeek, investors' confidence in US AI stocks has started to waver, and large - scale selling behaviors are emerging continuously. This wavering of confidence has led to a sharp drop in NASDAQ futures, and the market has deep concerns about the future trend of US technology stocks. In the past, the continuous investment of US technology giants in the AI field has continuously driven up the valuation of enterprises, and investors were full of confidence in the development prospects of the US AI industry. However, DeepSeek has rapidly risen with its low - cost and high - performance models, breaking the original market pattern and making investors start to re - evaluate the investment value of US AI stocks.

The emergence of DeepSeek has led to significant changes in the performance and investment strategies of US technology giants. Recently, six of the "Big Seven Tech" in US stocks released their fourth - quarter 2024 financial reports. The cloud business growth rates of Alphabet, Amazon, and Microsoft all slowed down. In the fourth quarter of last year, Alphabet, the parent company of Google, had cloud business revenue of $11.955 billion, a year - on - year increase of 30%, lower than the market - expected $12.2 billion, and the growth rate slowed down. The year - on - year increase in the previous quarter was over 34%, and its market share was still lower than that of competitors Microsoft and Amazon. Amazon's most - watched AWS cloud business had revenue of $28.786 billion in the quarter, close to the market - expected $28.8 billion, a year - on - year increase of 19%, the same increase rate as the previous quarter. Microsoft's fourth - quarter 2024 results exceeded expectations, but the growth rate of its much - anticipated Azure cloud business declined. The revenue of Azure and other cloud services in the quarter increased by only 31%, not only lower than the 33% in the previous quarter but also failing to meet market expectations.

The success of DeepSeek has made the market question the rationality of the huge capital expenditures of US technology giants in the AI field. However, despite the uncertain prospects of AI investment returns, the enthusiasm of technology giants for AI investment has not waned. According to statistics, the combined capital expenditures of Alphabet, Meta, Microsoft, Tesla, and Amazon in 2025 are expected to reach as high as $331 billion. Meta CEO Mark Zuckerberg said that he still believes that investing heavily in the company's AI infrastructure will become a strategic advantage. Microsoft CEO Satya Nadella believes that increasing AI spending will help alleviate the capacity problem that restricts the company from fully leveraging its AI capabilities.

The spread of DeepSeek's technology has weakened the unique technological advantages of the United States, and the US dollar may face marginal downward pressure. Initially, the US dollar reacted to DeepSeek by rising, but in the long run, DeepSeek will ultimately have a negative impact on the US dollar. Against the backdrop of the current new US administration, DeepSeek may trigger a series of policy adjustments, and the possibility of fiscal easing may increase.

In the medium - to - short term, Deutsche Bank compares the impact of DeepSeek to the bursting of the Internet bubble in the early 2000s. At that time, external shocks led to a significant decline in the valuation of US technology stocks, triggering a reduction in capital expenditures, which spread to the real economy and ultimately led to a mild recession in the US economy. As a result, the Federal Reserve adopted a more dovish policy, and the bond market rose. The US dollar initially had a complex reaction due to risk - aversion sentiment, but ultimately weakened due to reduced stock market inflows and a narrowing of the interest rate spread. Deutsche Bank believes that the emergence of DeepSeek may trigger a similar chain reaction, affecting the US macro - economy and the trend of the US dollar. The impact of DeepSeek on the United States is unprecedented. It can shake the overall US market situation with technology and economy. DeepSeek goes beyond what people can imagine. Excluding other external factors, it currently seems not easy for the United States to sanction DeepSeek to curb its market impact.