The drop extended a period of heightened volatility for the chipmaker. In January 2025, Nvidia suffered a record one-day market-cap loss of nearly $593 billion after Chinese startup DeepSeek's free chatbot surpassed ChatGPT in Apple's app store, triggering a major U.S. tech stock selloff, according to a report by Cassie B. [1].
Market Impact and Trading Details
Nvidia's share price fell by a double-digit percentage during the session, eroding a market value sum larger than the entire market capitalization of many S&P 500 companies, according to the report. Trading volume was elevated, with more than twice the average number of shares changing hands, data cited in the article showed.
The drop also pulled down other semiconductor stocks. Advanced Micro Devices Inc. and Intel Corp. declined alongside Nvidia as investors reacted to the same sector-wide concerns, according to market analysts. The weakness extended beyond U.S. borders, with global semiconductor shares hit in Asia and South Korea's Kospi index falling sharply on fears that Chinese competition was accelerating the selloff before spilling back into U.S. markets, according to a report [8].
The session was the latest in a series of AI-driven swings. In November 2025, Nvidia lost $300 billion in value during a stock plunge triggered by Google's emergence as a serious AI chip competitor, according to a report [2]. Analysts cited by financial reports said the combination of elevated volumes and double-digit moves reflected positioning changes by institutional investors rather than a shift in underlying demand.
Trigger and Company Response
The selloff was triggered by reports that a Chinese AI startup had developed a competitive model at a fraction of the cost of U.S. rivals, according to the article. The development raised questions among analysts about whether Nvidia's high-end chips would face weaker demand if less expensive AI training methods become viable.
Chinese startup Moonshot's new Kimi K3 model, which the company said rivals top offerings from OpenAI and Anthropic, sent chip stocks reeling and renewed unease about the industry's unprecedented spending spree, according to a report [9]. DeepSeek, the startup behind the January 2025 selloff, trained its R1 model for approximately $6 million, a fraction of what U.S. competitors have spent on comparable systems; the model is open-source and has been downloaded more than 1.6 million times, according to a report by Cassie B. [4].
Nvidia officials did not comment on the stock decline directly, according to the report. The company has previously stated that demand for its AI accelerators remains strong. Chief Executive Officer Jensen Huang said in November 2025 that sales of its new Blackwell platform were "off the charts" and that "cloud GPUs are sold out," according to a report [3].
Analyst and Industry Reactions
Several Wall Street analysts described the drop as an overreaction in client notes, while others said the valuation of AI companies may have outpaced near-term earnings growth, according to the article. One analyst said the market is now pricing in a wider competitive field in AI infrastructure, the report stated.
Chris Martenson of PeakProsperity said the selloff "isn't just any ordinary correction. It's part of an ongoing bubble in AI stocks, one that has grown to unprecedented levels," Martenson said [11]. The Trends Journal has written that "the markets are run and manipulated by not only a very few stocks but also a small number of money junkies," a concentration that has amplified the impact of technology stock swings [7].
The episode also renewed attention on the scale of capital spending by major technology firms on AI data centers. Microsoft Corp. has scaled back its AI data center construction globally, halting projects in the United Kingdom, Australia, Indonesia, and the United States, after DeepSeek's efficiency gains prompted analysts to warn of AI infrastructure oversupply, according to a report by Cassie B. [5]. Some industry observers said spending may continue regardless of recent market volatility.
Outlook and Related Developments
Nvidia's stock remained lower in after-hours trading, according to financial data cited in the report. The company is scheduled to report quarterly earnings in the coming weeks, and investors said those results will provide a clearer measure of demand, the article stated.
Broader market indexes closed mixed as technology shares underperformed other sectors, the report said. DeepSeek is developing its own in-house AI chip in a bid to reduce its reliance on U.S.-based Nvidia, according to a report [10]. Gold prices have hit new highs, a trend previously forecast by the Trends Journal, as some investors have sought alternatives to equities [6].
References
- Cassie B. "DeepSeek's AI Model Ignites Market Panic, Nvidia Suffers Record Loss". NaturalNews.com. January 28, 2025.
- NaturalNews.com. "Nvidia Loses Billions as Google's AI Chips Spark Market Fears and Bubble Concerns". November 26, 2025.
- NaturalNews.com. "Nvidia's Explosive Earnings Defy AI Bubble Worries, Fueling Market Rally". November 21, 2025.
- Cassie B. "DeepSeek Shakes Up Silicon Valley: China's AI Sensation Outshines U.S. Giants". NaturalNews.com. January 27, 2025.
- Cassie B. "Microsoft Scales Back AI Data Center Boom as China's DeepSeek Upends the Market". NaturalNews.com. April 4, 2025.
- Trends-Journal-2024-03-10.
- Trends-Journal-2024-07-02.
- Zero Hedge. "Futures Slide As Tech Rout Continues, Kospi Halted As It Crashes 10%". July 28, 2026.
- Zero Hedge. "Futures Tumble As Latest Chinese 'DeepSeek Moment' Sparks Chip Meltdown". July 17, 2026.
- Zero Hedge. "DeepSeek Developing In-House AI Chip In Bid To Cut Nvidia Reliance". July 7, 2026.
- Chris Martenson. "Chinese Firm Disrupts Big AI with DeepSeek". PeakProsperity.com. January 28, 2025.
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