As Deep Seek Shakes Tech, Nasdaq Futures Drop 5% – Europe Market Wrap
Stocks fell, with Nasdaq futures down 5%, on concerns that a cheaper AI model from China could threaten US tech dominance.
Nvidia fell 12% in premarket trade in the US, setting up the company for the largest decrease in market capitalisation on record if the trend continues. The amount of Nasdaq 100 futures contracts changing hands was around four times the 30-day average. S&P 500 futures fell as much as 3%, and Bitcoin fell below $100,000.
DeepSeek generated excitement over the weekend, with tech analysts claiming the company’s AI model outperforms the world’s best chatbots at a tenth of the cost.
In Europe, ASML fell 10%, the most since October, impacting the Stoxx 600, which was down 0.6%.
Traders also noted that Trump’s disagreement with Colombia over the weekend fuelled the market’s gloomy sentiment. The 10-year US bond yield fell by as much as 10 bps to 4.52% as investors sought safe-haven assets.
[06:17 ET] Traders add to Fed bets, fully pricing 50bps of cuts this year.