Nvidia's stock is rebounding after a recent slump, driven by initial concerns over DeepSeek's cost-effective AI model potentially impacting demand for Nvidia's products. DeepSeek, a Chinese AI company, introduced a new AI model that competes with established players like OpenAI's ChatGPT at a lower cost, initially causing Nvidia's stock to drop significantly. However, analysts are now suggesting that these fears may be exaggerated, as skepticism remains about DeepSeek's ability to disrupt Nvidia's market position, particularly in the U.S. market. Nvidia's continued dominance in AI and autonomous applications, along with the open-source nature of DeepSeek's model, could ultimately benefit the broader AI ecosystem.
The AXS 1.25X NVDA Bear Daily ETF (NVDS) experienced a sharp decline, falling 7.49% to $26.30 as of 6:00 AM on Tuesday, January 28.