Nvidia's stock is rebounding after an initial slump caused by concerns over DeepSeek's cost-effective AI model, which threatened to reduce demand for Nvidia's advanced chips. The Chinese AI company's new model, developed using Nvidia's H800 chips, initially led to a 17% drop in Nvidia's stock as investors feared a decline in demand. However, skepticism remains about DeepSeek's ability to significantly disrupt Nvidia's market position, particularly in the U.S. market. Analysts suggest that while DeepSeek's innovations are noteworthy, Nvidia's dominance in AI and autonomous applications remains largely unchallenged. The open-source nature of DeepSeek's model could also stimulate further research and development, potentially benefiting the broader AI ecosystem.
The ETF Opportunities Trust T-Rex 2X Inverse NVIDIA Daily Target ETF (NVDQ) experienced a significant decline, dropping 10.82% to $3.38 at 6:00 AM on Tuesday, January 28.