Nvidia's stock is rebounding after a recent downturn, 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 Nvidia's market position, particularly in the U.S., remains strong. The open-source nature of DeepSeek's model could even stimulate further research and development, benefiting the broader AI ecosystem.
The Direxion Daily NVDA Bull 2X Shares (NVDU) surged 10.36% to $75.44 as of 6:00 AM on Tuesday, January 28.