US Stock Futures Experience Sharp Decline Amid DeepSeek's AI Breakthrough

In an unexpected turn of events, US stock futures took a nosedive during Monday's premarket trading. This dramatic shift was largely attributed to the disruptive emergence of DeepSeek, a Chinese AI company that has recently made waves in the technology sector.

DeepSeek's R1 Model: A Game-Changer in AI

The catalyst behind this market upheaval is DeepSeek's R1 model, which has not only achieved unexpected success but also topped the Apple App Store charts. This remarkable achievement has raised questions about the future of capital-intensive AI hardware investments in the US, casting a shadow of doubt over their long-term viability.

Market Reactions and Currency Impacts

At 3:28 am ET, the financial markets reflected this uncertainty. The Dow Jones Industrial Average saw a decline of 0.83%, or 366.98 points. Similarly, the Nasdaq 100 and the S&P 500 experienced significant drops of 3.01% and 1.83%, respectively. The euro also felt the impact, declining 0.19% against the dollar to 1.04744.