Leading cryptocurrencies pared early losses on Monday as DeepSeek concerns weighed on risk-on markets.



<figure class="wp-block-table"><table style="overflow:auto; height: 90px; display: block;"><tbody><tr><td>Cryptocurrency</td><td>Gains +/-</td><td>Price (Recorded at 7:45 p.m. ET)</td></tr><tr><td>Bitcoin (CRYPTO: <a class="ticker" href="https://www.benzinga.com/quote/btc/usd">BTC</a>)</td><td>–0.22%</td><td>$102,161.99</td></tr><tr><td>Ethereum (CRYPTO: <a class="ticker" href="https://www.benzinga.com/quote/eth/usd">ETH</a>) &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</td><td>-1.72%</td><td>$3,173.62</td></tr><tr><td>Dogecoin (CRYPTO: <a class="ticker" href="https://www.benzinga.com/quote/doge/usd">DOGE</a>)&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;</td><td>-0.03%</td><td>$0.3339</td></tr></tbody></table></figure>



What Happened: Bitcoin slipped below $98,000 in the early morning hours before reclaiming the $102,000 level by evening. The leading cryptocurrency navigated choppy waters for most of the day.



Ethereum rose from $3,024 to $3,230 but fell back to the upper $3,100 range late in the evening.



Nearly $700 million was liquidated from the cryptocurrency market over the last 24 hours, with long positions accounting for $537 million.



About $900 million in upside bets risked liquidation if Bitcoin drops to $95,000.



That said, around 58% of traders on Binance were positioned for Bitcoin's price increases, according to the Long/Short ratio, signaling expectations of a rebound.



Bitcoin's Open Interest rose marginally by 0.15% in the last 24 hours.



Top Gainers (24-Hours)



<figure class="wp-block-table"><table style="overflow:auto; height: 90px; display: block;"><tbody><tr><td>Cryptocurrency</td><td>Gains +/-</td><td>Price (Recorded at 7:45 p.m. ET)</td></tr><tr><td>DeXe (DEXE)</td><td>+10.03%</td><td>$21.58</td></tr><tr><td>Hyperliquid (HYPE)</td><td>+6.77%</td><td>$23.53</td></tr><tr><td>Jupiter (JUP)</td><td>+6.26%</td><td>$1.12</td></tr></tbody></table></figure>



The global cryptocurrency market capitalization stood at $3.49 trillion, falling 0.29% in the last 24 hours.



Major stock averages tanked on Monday. The Nasdaq Composite slid 3.07% to end at 19,341.83. The S&amp;P 500 fell 1.46% to 6,012.28. The Dow Jones Industrial Average was the outlier, gaining 0.65% to close at 44,713.58.



Tech stocks were battered, with AI juggernaut Nvidia Corp. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>) shedding 17% of its market value on Monday, <a href="https://www.benzinga.com/economics/macro-economic-events/25/01/43244872/tech-stocks-tumble-on-ai-nightmare-nvidia-eyes-worst-day-since-march-2020-bitcoin-drops-below-100000-whats-driving-markets-monday">its worst single-day loss</a> ever.



The slump was precipitated by the rise of China's cost-effective DeepSeek AI model, challenging the high-cost strategies employed by U.S. tech giants.



See More: <a href="https://www.benzinga.com/money/best-crypto-scanners">Best Cryptocurrency Scanners</a>



Analyst Notes: Popular cryptocurrency analyst Rekt Capital noted that Bitcoin completed its first price discovery uptrend and its first price discovery correction.



"History suggests over the next two weeks&#8230; Bitcoin should be able to embark on its second price discovery uptrend to new highs," the analyst projected.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="500" data-dnt="true"><a href="https://twitter.com/hashtag/BTC?src=hash&amp;ref_src=twsrc%5Etfw">#BTC</a> Bitcoin has competed its 1st Price Discovery Uptrend BTC has most likely completed its 1st Price Discovery Correction History suggests over the next two weeks&#8230; Bitcoin should be able to embark on its second Price Discovery Uptrend to new highs<a href="https://twitter.com/search?q=%24BTC&amp;src=ctag&amp;ref_src=twsrc%5Etfw">$BTC</a> <a href="https://twitter.com/hashtag/Crypto?src=hash&amp;ref_src=twsrc%5Etfw">#Crypto</a> <a href="https://twitter.com/hashtag/Bitcoin?src=hash&amp;ref_src=twsrc%5Etfw">#Bitcoin</a>&mdash; Rekt Capital (@rektcapital) <a href="https://twitter.com/rektcapital/status/1883984912816206283?ref_src=twsrc%5Etfw">January 27, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



On-chain analytics firm CryptoQuant highlighted a strong correlation between Bitcoin and U.S. stocks.



"In 2024, BTC and the Nasdaq exhibited a historically strong correlation, which has reached unprecedented high levels today. A similar trend can be observed with the S&amp;P 500, although there have been brief periods of decoupling," CryptoQuant noted.



The increasing correlation suggested Bitcoin's appeal more as a traditional asset class than a hedge of inflation.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="500" data-dnt="true">Bitcoin maintains a strong correlation with the U.S. Stock Market "Correlation suggests that institutional investors may view Bitcoin more like a traditional asset class, aligning its performance with the US market trends." – By <a href="https://twitter.com/Darkfost_Coc?ref_src=twsrc%5Etfw">@Darkfost_Coc</a> Link &#x1f447;<a href="https://t.co/c25TfJIxnE">https://t.co/c25TfJIxnE</a> <a href="https://t.co/fiNbW8Y8YS">pic.twitter.com/fiNbW8Y8YS</a>&mdash; CryptoQuant.com (@cryptoquant_com) <a href="https://twitter.com/cryptoquant_com/status/1884037205490032933?ref_src=twsrc%5Etfw">January 28, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



Read Next:&nbsp;&nbsp;&nbsp;&nbsp;



<ul>
<li><a href="https://www.benzinga.com/markets/cryptocurrency/25/01/43244653/bitcoin-ethereum-solana-crash-heres-why-chinas-low-cost-ai-model-deepseek-may-be-to-blame">Bitcoin, Ethereum, Solana Crash — Here&#8217;s Why China&#8217;s Low-Cost AI Model DeepSeek May Be To Blame</a></li>
</ul>



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Bitcoin, Ethereum, Dogecoin Recover As DeepSeek Troubles Mount For US Tech Stocks: Analyst Suggests BTC Could Hit Fresh Highs Over Upcoming Two Weeks

Nvidia Corp. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>) has acknowledged China&#8217;s DeepSeek R1 artificial intelligence model. The startup&#8217;s emergence <a href="https://www.benzinga.com/markets/equities/25/01/43221806/nvidia-amd-broadcom-smci-tsmc-and-other-tech-giants-lead-monday-pre-market-selloff-as-nasdaq-100-futures-plummet-over-650-points-amid-reports-of-chinese-ai-startup-deepseek-overtaking-chatgpt">coincided with a $600 billion decline</a> in Nvidia&#8217;s market value on Monday.



What Happened: The endorsement came as DeepSeek&#8217;s open-source AI model, developed for under $6 million, reportedly outperformed leading U.S. models like those from OpenAI. The achievement sparked a broader tech selloff, with Nvidia shares falling 17% and AI infrastructure stocks tumbling over 20%.



&#8220;DeepSeek&#8217;s work illustrates how new models can be created using test time scaling, leveraging widely-available models and compute that is fully export control compliant,&#8221; an Nvidia spokesperson <a href="https://www.cnbc.com/2025/01/27/nvidia-calls-chinas-deepseek-r1-model-an-excellent-ai-advancement.html">told</a> CNBC. 



DeepSeeks &#8220;inference requires significant numbers of Nvidia GPUs and high-performance networking,&#8221; Nvidia said according to Reuters.



The company emphasized that DeepSeek used approved GPU versions designed for the Chinese market, countering claims about potential export violations.



The market reaction highlighted growing concerns about AI infrastructure spending after DeepSeek demonstrated comparable performance to U.S. models at a fraction of the cost. Major tech companies have committed massive capital to AI development, with Microsoft Corp. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MSFT#NASDAQ">MSFT</a>) <a href="https://www.benzinga.com/25/01/42801720/microsoft-to-invest-80-billion-in-ai-data-centers-for-fiscal-2025">planning $80 billion in AI infrastructure spending</a> for 2025 and Meta Platforms Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/META#NASDAQ">META</a>) projecting $60-65 billion.



See Also: <a href="https://www.benzinga.com/news/global/25/01/43251316/tesla-faces-boycott-call-in-poland-over-musks-wwii-comments">Tesla Faces Boycott Call In Poland Over Musk&#8217;s WWII Comments: &#8216;No Normal Pole Should Buy&#8217;</a>



Why It Matters: Wedbush analyst Dan Ives <a href="https://www.benzinga.com/tech/25/01/43223228/satya-nadella-said-we-should-take-development-out-of-china-very-very-seriously-now-deepseeks-r1-has-emerged-as-chatgpt-killer-outperforming-openai-with-50x-cheaper-prices-heres-more">called the selloff a</a> &#8220;golden buying opportunity,&#8221; arguing that &#8220;No US Global 2000 is going to use a Chinese startup DeepSeek to launch their AI infrastructure.&#8221;



The development aligns with recent discussions by industry leaders about &#8220;test-time scaling,&#8221; a concept championed by Nvidia CEO Jensen Huang and OpenAI CEO Sam Altman. This approach suggests AI models can achieve better results by using additional computing power during inference rather than just during training.



DeepSeek&#8217;s rapid rise &#8211; becoming the most downloaded app on Apple Inc.&#8216;s U.S. App Store &#8211; has sparked debate about the sustainability of massive AI investments and their impact on data center infrastructure providers like Vertiv Holdings Co. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VRT#NYSE">VRT</a>) and Vistra Corp. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VST#NYSE">VST</a>), which saw their shares plummet by nearly 30% on Monday.



Price Action: Nvidia&#8217;s stock closed at $118.58 on Monday, down 16.86% for the day. In after-hours trading, the stock edged up 1.35%. Over the past year, Nvidia&#8217;s stock surged 89.81%, according to <a href="https://www.benzinga.com/pro/">data from Benzinga Pro</a>.



Read Next: 



<ul>
<li><a href="https://www.benzinga.com/25/01/43256073/jensen-huangs-biggest-fear-isnt-ai-competitionits-the-stage-why-public-speaking-terrifies-silicon-valleys-coolest-leaders-including-musk-zuckerberg-and-buffett">Jensen Huang&#8217;s Biggest Fear Isn&#8217;t AI Competition—It&#8217;s Pre-Show Butterflies: How Silicon Valley&#8217;s Coolest Leaders Like Mark Zuckerberg And Elon Musk Are Gripped With Stage Fright</a></li>
</ul>



Image Via Shutterstock 



Disclaimer:&nbsp;This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.

Equities

MSFT

Nvidia Says DeepSeek An 'Illustration' Of How New AI Models Can Be Created While Being Export-Control Compliant Amid $600 Billion Market Value Plunge

On Monday, Cathie Wood-led Ark Invest executed significant trades involving major companies such as Tesla Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/TSLA#NASDAQ">TSLA</a>), Advanced Micro Devices Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AMD#NASDAQ">AMD</a>) , Palantir Technologies Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/PLTR#NASDAQ">PLTR</a>), and Amazon.com Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AMZN#NASDAQ">AMZN</a>).



The Tesla Trade



On Monday, Ark Invest made a notable move by selling 20,392 shares of Tesla Inc. through ARK Next Generation Internet ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ARKW#NYSE">ARKW</a>). The sale was valued at approximately $8.1 million. This decision comes amid growing concerns over <a href="https://www.benzinga.com/markets/equities/25/01/43219987/tesla-could-drop-over-13-due-to-trumps-potential-ev-tax-credit-cuts-fsd-and-delivery-concerns-says-gary-black">potential cuts to electric vehicle tax credits</a> under the Trump administration, as highlighted by Gary Black, Managing Partner at Future Fund LLC. Tesla&#8217;s stock faced a 2.32% decline, closing at $397.15, as investors reacted to these uncertainties and diverging forecasts for Tesla&#8217;s 2025 delivery growth.



The Advanced Micro Devices Trade



Ark Invest also increased its stake in AMD. by purchasing 42,554 shares through the ARKW ETF, amounting to a transaction worth approximately $4.89 million. AMD&#8217;s stock experienced a significant drop of 6.37%, closing at $115.01, following a broader selloff in the tech sector. This decline was triggered by reports of <a href="https://www.benzinga.com/markets/equities/25/01/43221806/nvidia-amd-broadcom-smci-tsmc-and-other-tech-giants-lead-monday-pre-market-selloff-as-nasdaq-100-futures-plummet-over-650-points-amid-reports-of-chinese-ai-startup-deepseek-overtaking-chatgpt">Chinese AI startup DeepSeek unveiling a competitive AI model</a>, which impacted major technology stocks, including AMD.



The Palantir Trade



Ark Invest sold 60,375 shares of Palantir Technologies Inc. via the ARKW ETF, with the sale valued at around $4.55 million. Palantir&#8217;s shares fell by 4.48%, closing at $75.44, amid <a href="https://www.benzinga.com/25/01/43234047/palantir-stock-is-falling-monday-whats-going-on">heightened competition</a> concerns from DeepSeek&#8217;s AI advancements. The tech-heavy Nasdaq faced heavy selling pressure, contributing to Palantir&#8217;s stock decline.



The Amazon Trade



Ark Invest bolstered its position in Amazon.com Inc. by purchasing a total of 7,461 shares across the ARK Innovation ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ARKK#NYSE">ARKK</a>) and ARKW ETFs. The combined purchase was valued at approximately $1.76 million, based on Amazon&#8217;s closing price of $235.42. Amazon&#8217;s stock saw a modest increase of 0.24% on the day. Wood has been loading up on Amazon stock, she <a href="https://www.benzinga.com/25/01/42835519/cathie-woods-monday-moves-dumps-15m-worth-of-hot-stock-palantir-loads-up-amazon-com">purchased $8.9 million worth of shares</a> in early January. 



Other Key Trades:



<ul>
<li>Purchased 31,548 shares of Cameco Corp through ARKQ.Sold 53,234 shares of Rocket Lab USA Inc. via ARKQ.</li>



<li>Bought 52,490 shares of Salesforce Inc. through ARKW.Sold 808,859 shares of Nu Holdings Ltd via ARKW.</li>
</ul>



Read Next: 



<ul>
<li><a href="https://www.benzinga.com/25/01/43256560/nvidia-faces-investor-panic-as-chinas-deepseek-emerges-but-top-analyst-predicts-higher-ai-infrastructure-demand-despite-market-jitters-the-market-is-overreacting-to-deepseeks-success">Amid Nvidia And Chinese AI Anxieties, Top Analyst Predicts Higher AI Infrastructure Demand Despite Market Jitters: &#8216;The Market Is Overreacting To DeepSeek&#8217;s Success&#8217;</a></li>
</ul>



Image via Shutterstock



This story was generated using <a href="https://www.benzinga.com/author/benzinga-neuro">Benzinga Neuro</a> and edited by <a href="https://www.benzinga.com/author/shivdeep-dhaliwal" target="_blank" rel="noreferrer noopener">Shivdeep Dhaliwal</a>

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Cathie Wood Swoops In To Buy AMD Shares Amid DeepSeek Tech Upheaval, Dumps Tesla Stock Worth $8.1 Million

The AI boom that fueled a historic rally in semiconductor and infrastructure stocks over the past two years came to a screeching halt Monday, as a wave of selling swept through the market following the launch of DeepSeek, <a href="https://www.benzinga.com/markets/asia/25/01/43243584/deepseek-r1-vs-openai-what-consumers-need-to-know-about-ais-latest-challenger">China's open-source AI model.</a>



While NVIDIA Corp. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>) grabbed the top of headlines for its $600 billion market-cap wipeout — the largest single-day loss in U.S. market history — and triggered a 7.8% fall in the iShares Semiconductor ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/SOXX#NASDAQ">SOXX</a>), the pain was even more severe in AI infrastructure stocks, which have soared on expectations of an arms race in AI-driven capital expenditures.



Power, cooling and data center giants that once rode the AI euphoria saw single-day losses exceeding 20%, as investors reassessed the sustainability of relentless spending in the sector.



<figure class="wp-block-table is-style-stripes"><table style="overflow:auto; height: 90px; display: block;"><tbody><tr><td>Name</td><td>2023 Return</td><td>2024 Return</td><td> % Change on Jan. 27, 2025 </td></tr><tr><td>Vertiv Holdings Co. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VRT#NYSE">VRT</a>)</td><td>+251%</td><td>+136%</td><td>-29.87%</td></tr><tr><td>Vistra Corp. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VST#NYSE">VST</a>)</td><td>+66%</td><td>+257%</td><td>-28.31%</td></tr><tr><td>Astera Labs, Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/ALAB#NASDAQ">ALAB</a>)</td><td>N/A</td><td>+154%</td><td>-28.08%</td></tr><tr><td>Comfort Systems USA, Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/FIX#NYSE">FIX</a>)</td><td>+79%</td><td>+106%</td><td>-25.65%</td></tr><tr><td>Arista Networks Inc (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ANET#NYSE">ANET</a>)</td><td>+94%</td><td>+87%</td><td>-22.38%</td></tr><tr><td>GE Vernova Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/GEV#NYSE">GEV</a>)</td><td>N/A</td><td>+185%</td><td>-21.55%</td></tr><tr><td>Constellation Energy Corp. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/CEG#NYSE">CEG</a>)</td><td>+36%</td><td>+91%</td><td>-21.00%</td></tr></tbody></table></figure>



&#8220;What makes Monday&#8217;s tech sell-off so jarring is that the valuations of many of these AI and tech companies offer no margin of error. Excessive valuation always becomes a problem, eventually, but fundamental news becomes a heightened problem when it is combined with excessive valuation,&#8221; said David Bahnsen, chief investment officer at The Bahnsen Group.



<h1 class="wp-block-heading">Why These AI Infrastructure Stocks Soared, Why They're Crashing Now</h1>



Stocks tied to data centers, power and networking, some of the biggest winners of the AI boom over the past two years, were hammered Monday as investors started questioning whether the relentless spending on AI infrastructure is truly sustainable.



<h1 class="wp-block-heading">1. Vertiv Holdings Co</h1>



Vertiv, a leader in data center cooling, surged 251% in 2023 and another 136% in 2024 as AI-driven computing loads pushed cooling demand through the roof. Yet, with concerns that data center expansion could slow, shares plunged nearly 30% on Monday, marking the worst day since Feb. 2022. 



<h1 class="wp-block-heading">2. Vistra Corp. </h1>



Vistra, one of the biggest power suppliers, had been riding the AI energy boom on bets that AI-driven electricity demand would continue to soar. Monday's sell-off crushed that narrative, sending shares down 28%, the worst single-day decline since the company went public in 2017.



In 2024, Vistra returned 257% to shareholders, recording the second-strongest performance among S&amp;P 500 stocks behind Palantir Technologies Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/PLTR#NASDAQ">PLTR</a>). 



<h1 class="wp-block-heading">3. Astera Labs </h1>



Astera Labs, which specializes in connectivity chips for AI workloads, went public in 2024 and quickly gained 154% as its products became critical for AI data centers. However, Monday's rout saw the stock plummet nearly 30%, the worst drop since the company&#8217;s IPO last March, as investors feared a pullback in AI server deployments.



<h1 class="wp-block-heading">4. Comfort Systems USA</h1>



Comfort Systems, a HVAC and engineering solutions provider for commercial buildings and data centers, surged on AI-related construction demand. Yet, with AI firms now potentially reining in expansion, shares fell 26%. This represented the worst one-day drop since October 1999. 



<h1 class="wp-block-heading">5. Arista Networks </h1>



Arista Networks, a leading supplier of high-speed networking equipment for cloud providers, nearly doubled in 2023 as AI-driven upgrades boosted orders. Yet, with DeepSeek's efficiency raising questions about demand for high-end AI networking, the stock slid 22%.



<h1 class="wp-block-heading">6. GE Vernova </h1>



GE Vernova, the energy spin-off from General Electric, had benefited from AI-driven electrification trends, posting a 185% gain in 2024. However, with data center demand expectations cooling, shares slumped 21.5%.



<h1 class="wp-block-heading">7. Constellation Energy</h1>



Constellation, a nuclear energy leader, had been a key bet for long-term AI power needs, rallying 91% in 2024. On Monday, CEG shares tumbled 21% — the largest drop since the company&#8217;s IPO in 2022 — amid investor doubts creeping in over AI's real energy demand.



Read Next: 



<ul>
<li><a href="https://www.benzinga.com/analyst-ratings/analyst-color/25/01/43250480/nvidia-sinks-below-200-day-average-for-first-time-in-2-years-deepseek-technical-reset">Nvidia Sinks Below 200-Day Moving Average For First Time In 2 Years As DeepSeek Sparks Historic Technical Reset</a></li>
</ul>



Photo: Pathdoc on Shutterstock.

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7 AI Infrastructure Stocks Plunge Over 20%, Outpace Semiconductor Rout As DeepSeek Upends Investment Landscape

Nvidia Corp. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>) lost a key technical support on Monday, breaking below its 200-day moving average after a staggering selloff. The slump followed the launch of DeepSeek, a Chinese open-source AI platform, which triggered investor concerns over demand <a href="https://www.benzinga.com/economics/macro-economic-events/25/01/43244872/tech-stocks-tumble-on-ai-nightmare-nvidia-eyes-worst-day-since-march-2020-bitcoin-drops-below-100000-whats-driving-markets-monday">for Nvidia's premium chips.</a>



<h3 class="wp-block-heading">Nvidia Loses Key Technical Support In Major AI Shakeup</h3>



Nvidia&#8217;s stock had plunged 16% to $178 per share by 3:15 p.m. ET, marking its worst session since March 18, 2020. This drop generated a major technical reset, as the stock had remained above its 200-day moving average since January 12, 2023.



The U.S. largest semiconductor company also wiped out over $600 billion in market capitalization, setting the largest single-day loss in U.S. stock market history. 



Leveraged exchange-traded funds tracking Nvidia stock such as the Direxion Daily NVDA Bull 2X Shares (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDU#NASDAQ">NVDU</a>) and the GraniteShares 2x Long NVDA Daily ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDL#NASDAQ">NVDL</a>) both cratered by 35%. 



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1024" height="506" src="https://editorial-assets.benzinga.com/wp-content/uploads/2025/01/27151351/image-210-1024x506.png" alt="" class="wp-image-752092" srcset="https://editorial-assets.benzinga.com/wp-content/uploads/2025/01/27151351/image-210-1024x506.png 1024w,https://editorial-assets.benzinga.com/wp-content/uploads/2025/01/27151351/image-210-300x148.png 300w,https://editorial-assets.benzinga.com/wp-content/uploads/2025/01/27151351/image-210-768x380.png 768w,https://editorial-assets.benzinga.com/wp-content/uploads/2025/01/27151351/image-210-1536x759.png 1536w,https://editorial-assets.benzinga.com/wp-content/uploads/2025/01/27151351/image-210.png 1920w" sizes="(max-width: 1024px) 100vw, 1024px" /></figure>



<h3 class="wp-block-heading">DeepSeek's AI Surge Reshapes Market Expectations</h3>



On the CFTC-regulated platform Kalshi, the odds of DeepSeek winning &#8220;Best AI Model of the Year&#8221; skyrocketed from 25% to 46% on Monday. The surge came as the Chinese large language model dominated App Store downloads, signaling strong early adoption.



&#8220;Monday&#8217;s tech selloff is being driven by a fundamental catalyst: concerns that DeepSeek is surpassing ChatGPT in usage and could reduce demand for Nvidia's most advanced chips,&#8221; said David Bahnsen, chief investment officer at The Bahnsen Group.



David Morrison, senior market analyst at Trade Nation, highlighted that DeepSeek has achieved this feat &#8220;at a fraction of the cost, using less powerful Nvidia chips, effectively bypassing U.S. export restrictions.&#8221;



With Nvidia's next earnings report scheduled in a month from now, Wall Street is weighing whether its AI-driven capital spending may be outpacing revenue growth.



&#8220;The key question is whether Nvidia will disappoint, as its capital spending on AI is soaring faster than its revenues, which could squeeze profit margins,&#8221; said veteran market strategist Ed Yardeni.



<h3 class="wp-block-heading">Security Concerns Surround DeepSeek's Rise</h3>



Cybersecurity expert Adrianus Warmenhoven of NordVPN warned that DeepSeek's rapid adoption raises serious privacy and security concerns, particularly given China's strict regulatory environment.



&#8220;The emergence of startups like DeepSeek presents both opportunities and risks for user security. It's crucial to approach these platforms with caution, especially given the stark differences in global data privacy laws,&#8221; Warmenhoven said.



He highlighted the potential risks tied to China's government oversight on data collection, storage, and usage, adding that users outside of China should be wary of how their interactions with DeepSeek are being tracked and processed.



&#8220;China has some of the world's most stringent regulations on data access and state surveillance. If DeepSeek gains international traction, users must understand what data they are sharing and where it's being stored,&#8221; he said.



Warmenhoven also indicated that AI-driven applications are prime targets for cyber threats, and that DeepSeek&#8217;s sudden popularity could make it an attractive vector for exploitation. 



&#8220;We've seen in the past how new AI platforms can be vulnerable to security flaws, and DeepSeek is no exception.&#8221; &#8220;Furthermore, there is always the risk of cyber attacks,&#8221; he added.



Read now: 



<ul>
<li><a href="https://www.benzinga.com/economics/macro-economic-events/25/01/43247030/traders-want-the-fed-to-tame-market-volatility-yet-trump-powell-interest-rate-fight-is-just-beginning">Traders Want The Fed To Tame Market Volatility, Yet Trump-Powell Interest Rate Fight Is Just Beginning</a></li>
</ul>



Image: Shutterstock

Specialty ETFs

NVDL

NVDU

Nvidia Sinks Below 200-Day Moving Average For First Time In 2 Years As DeepSeek Sparks Historic Technical Reset

Tesla Faces Polish Boycott Call Over Musk's Remarks: ‘No Normal Pole Should Buy'



A Polish government official is calling for a boycott of Tesla Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/TSLA#NASDAQ">TSLA</a>) vehicles in the country after recent comments made by CEO Elon Musk at a rally for German far-right<a href="https://www.benzinga.com/news/25/01/43218481/elon-musks-shocking-remarks-to-far-right-german-party-too-much-focus-on-past-guilt"> Alternative for Germany party.</a>



What Happened: Musk made a surprise virtual appearance at the Alternative for Germany rally Saturday, <a href="https://www.benzinga.com/news/global/24/12/42732904/elon-musk-blasted-as-intrusive-and-presumptuous-for-trying-to-influence-german-elections-toward-far-right-party">continuing his support</a> for the party ahead of Germany's Feb. 23 election.



During his appearance, Musk downplayed the importance of moving on from Germany&#8217;s past, potentially referencing the Nazi party and World War II.



"Children should not be guilty of the sins of their parents, let alone their great-grandparents," Musk said, as reported by <a href="https://www.bloomberg.com/news/articles/2025-01-27/tesla-faces-call-for-boycott-in-poland-after-musk-s-germany-remarks?srnd=homepage-americas&amp;sref=TBDibEcD">Bloomberg</a>.



Musk said there is a "too much focus on past guilt" during his virtual appearance.



The billionaire's comments upset Polish Sports and Tourism Minister Slawomir Nitras, who serves under the ruling Civic Platform party.



"Maybe Mr. Musk with his billions doesn't feel threatened. But every normal person living in the center of Europe, who remembers what happened eighty years ago, cannot look on indifferently," Nitras said during a radio interview.



Nitras' comments came as Poland recognizes the 80th anniversary of the liberation of the Auschwitz concentration camp on Monday. Millions of Polish people, including many Jewish people, died in Poland at the hands of the Nazi party, with over 1 million people killed at Auschwitz.



"All I can say is that probably no normal Pole should buy a Tesla anymore," Nitras added.



Read Also: <a href="https://www.benzinga.com/24/12/42630076/tesla-model-y-could-lose-bestselling-title-in-europe-to-this-non-ev-car">Tesla Model Y Could Lose Bestselling Title In Europe To This Non-EV Car</a>



Why It's Important: Tesla is the most popular electric vehicle company in Poland with 4,460 units sold in 2024, according to the report. Mercedes-Benz (1,640), Volvo (1,260), BMW (1,240) and Audi (1,020) round out the top five EV sellers in the country.



Poland launched electric vehicles government subsidies of up to $9,958 last year to help boost electric vehicle purchases, a plan that may have benefitted Tesla.



Tesla has five showrooms and 15 Tesla Supercharger locations in Poland according to the report.



The call to ban Tesla vehicles in Poland comes as recent reports show Musk's deeper push into politics in recent years could be hurting the electric vehicle company.



Tesla fell to 36th place, down from 18th place, in the 2025 global brand rankings<a href="https://www.benzinga.com/news/global/25/01/43172806/tesla-lost-15-billion-in-brand-value-in-2024-report-says-did-elon-musks-political-push-hurt-ev-giant"> from Brand Finance.</a> The annual report showed Tesla having a brand value of $43 billion in the 2025 rankings, down 26% from $58.27 billion in 2024.



&#8220;There are people who think he&#8217;s wonderful, but many that don&#8217;t,&#8221; Brand Finance CEO&nbsp;David Haigh&nbsp;told CNBC of Musk. &#8220;If you are buying electric vehicles, his persona is highly likely to impact your view of whether or not you want to buy one of his company&#8217;s cars, but that&#8217;s only one of many factors.&#8221;



Tesla's scores in categories such as &#8220;reputation,&#8221; &#8220;recommendation&#8221; and &#8220;consideration&#8221; all fell from the prior year.



Benzinga previously reported that some angry Tesla customers who don&#8217;t agree with Musk&#8217;s political push are <a href="https://www.benzinga.com/news/24/11/42023767/tesla-owners-who-dont-like-musk-are-letting-bumper-stickers-do-the-talking" target="_blank" rel="noreferrer noopener">buying bumper stickers </a>with phrases such as &#8220;I bought this before we knew Elon was crazy.&#8221;



A survey of Tesla owners in the Netherlands showed around one-third were considering selling their car, with Musk one of the main reasons.



The survey conducted by Dutch news outlet&nbsp;<a href="https://eenvandaag.avrotros.nl/panels/opiniepanel/alle-uitslagen/item/schaamte-bij-tesla-rijders-door-gedrag-elon-musk-3-op-de-10-eigenaren-willen-van-hun-auto-af/" target="_blank" rel="noreferrer noopener">EenVandaag&nbsp;</a>and shared by&nbsp;<a href="https://insideevs.com/news/747944/tesla-owners-musk-survey-netherlands/" target="_blank" rel="noreferrer noopener">InsideEVs&nbsp;</a>showed Tesla owners who thought Musk&#8217;s actions were making them reconsider their brand loyalty.



&#8220;If I had known what he is like now, I would have never bought a Tesla,&#8221; one Tesla owner said in the survey.



Read Next: 



<ul>
<li><a href="https://www.benzinga.com/general/social-media/25/01/43219015/elon-musk-faces-criticism-from-biographer-over-auschwitz-visit-he-truly-is-a-sociopath">Elon Musk Faces Criticism From Biographer Over Auschwitz Visit: &#8216;He Truly Is a Sociopath&#8217;</a></li>
</ul>



Photo: Shutterstock

Eurozone

Politics

Global

Tesla Faces Boycott Call In Poland Over Musk's WWII Comments: 'No Normal Pole Should Buy'

The Federal Reserve's first meeting of 2025 comes at a moment of elevated uncertainty, as a brutal tech sell-off erased trillions in market value and fresh tensions between President Donald Trump and Fed Chair Jerome Powell may threaten to shake interest rate policy <a href="https://www.benzinga.com/topic/interest-rates">in the months ahead.</a>



Tech stocks took a massive hit at the start of the week, driven by concerns over China&#8217;s DeepSeek, an open-source AI model that reportedly rivals top U.S. models at a <a href="https://www.benzinga.com/analyst-ratings/analyst-color/25/01/43239042/magnificent-seven-broadcom-lose-nearly-900-billion-in-value-as-deepseek-sparks-ai-carnage-why-this-expert-is-still-bullish-on-us-tech">fraction of the cost. </a>



The reaction was swift and severe. The VIX index, also known as market fear gauge, soared 25% on Monday with Wall Street shedding over $1.2 trillion in market capitalization. NVIDIA Corp. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>) tumbled 16%, erasing nearly $500 billion in value.



Despite the market chaos, it&#8217;s a done deal the Fed expected to keep interest rates unchanged at 4.25%-4.50% after three consecutive cuts totaling 100 basis points last year, giving investors no room to hope for a miracle. 



Yet, the real focus will be on Powell's messaging, whether he signals that further cuts are coming or if the central bank will hold firm in its inflation fight despite political interference from Washington. 



Trump has a history of pushing for lower interest rates, clashing with Powell during his first term over monetary policy. Now, with inflation moderating, the president appears ready to pressure the Fed again.



<h1 class="wp-block-heading">How Many Interest-Rate Cuts In 2025?</h1>



At its last meeting in December, the Fed projected only two rate cuts in 2025, revising earlier expectations of four. 



Policymakers also raised their inflation forecast for headline Personal Consumption Expenditures to 2.5%, up from 2.1% in September. Core PCE inflation, which excludes volatile food and energy prices, is now seen at 2.5% in 2025, up from 2.2% earlier.



Investors will be watching closely to see if Powell acknowledges recent benign inflation reports, which some argue could justify a more dovish stance. 



Goldman Sachs economist David Mericle highlighted in a note Monday that &#8220;in the press conference, we will listen for hints about whether the further decline in inflation we expect in coming months could open the door to rate cuts.&#8221;



<h1 class="wp-block-heading">Trump vs. Powell: A New Round In The Interest Rate Fight?</h1>



This week's Fed meeting will be the first since Trump returned to the White House, and tensions between the president and Powell are already heating up.



During a video speech at the <a href="https://www.benzinga.com/news/global/25/01/43170854/trump-outlines-economic-reset-at-davos-5-things-you-need-to-know">World Economic Forum last Thursday</a>, Trump made his stance on interest rates clear: "With oil prices going down, I&#8217;ll demand that interest rates drop immediately, and likewise, they should be dropping all over the world.&#8221;



Journalists will likely press Powell on whether Trump's remarks influence policy decisions, but the Fed chair has consistently emphasized the central bank's independence.



Yet, speculation is already swirling about whether Trump could try to remove Powell before his term expires in May 2026. 



According to Kalshi, a CFTC-regulated betting market, there is a 21% chance Powell will be out as Fed chair by the end of the year.


<iframe loading="lazy" style="border: 0;" src="https://kalshi.com/external-widgets/events/LEAVEPOWELL-25/markets/LEAVEPOWELL-25-DEC31?color_scheme=light&amp;widget_size=large" width="552px" height="400px"></iframe>


A pressing issue is the potential impact of Trump's trade policies on inflation. Goldman Sachs estimated last week that new tariffs could add up to one percentage point to inflation if they <a href="https://www.benzinga.com/25/01/43193866/trumps-tariff-hikes-could-stoke-consumer-inflation-jitters-challenge-fed-goldman-sachs-warns">significantly influence consumer expectations.</a> That could complicate the Fed's decision-making, forcing policymakers to balance inflation risks with economic growth concerns.



Beyond interest rates and inflation, another potential Trump-Powell clash could emerge over digital assets. 



The president signed last week an executive order aimed at strengthening U.S. leadership in digital assets, which some speculate could lay the groundwork for a Bitcoin (CRYPTO: <a class="ticker" href="https://www.benzinga.com/quote/btc/usd">BTC</a>) strategic reserve later this year.



Powell, however, remains firmly opposed to Bitcoin as a central bank asset. "We&#8217;re not allowed to own Bitcoin," he said in December, stressing that the Federal Reserve Act <a href="https://www.benzinga.com/news/econ-s/24/12/42564807/powell-triggers-market-carnage-vix-spikes-58-stocks-plummet-dollar-hits-2-year-highs-bitcoin-nosedives">prohibits such holdings. </a>



"People use Bitcoin as a speculative asset… It's just like gold, only it's virtual, it's digital," he also added. 



Read Now: 



<ul>
<li><a href="https://www.benzinga.com/analyst-ratings/analyst-color/25/01/43203417/dollar-cracks-below-50-day-moving-average-as-trumps-tariff-trade-unwinds-buy-the-rumor-sell-the-fact">Dollar Cracks Below 50-Day Moving Average As Trump&#8217;s Tariff Trade Unwinds: &#8216;Buy The Rumor, Sell The Fact&#8217;</a></li>
</ul>



Photo: Shutterstock

Macro Economic Events

Econ #s

Economics

Federal Reserve

Traders Want The Fed To Tame Market Volatility, Yet Trump-Powell Interest Rate Fight Is Just Beginning

The race among large language models has intensified with DeepSeek R1 emerging <a href="https://www.benzinga.com/topic/artificial-intelligence">as a formidable competitor</a> to established players like OpenAI&#8217;s o1 and Meta Platforms Inc.&#8216;s (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/META#NASDAQ">META</a>) Llama 3.2. 



Each model brings distinct strengths to the table, with DeepSeek emphasizing cost-efficiency and performance, while its rivals focus on multimodal capabilities and advanced reasoning.



What Happened: DeepSeek R1&#8217;s recent launch has fueled comparisons with OpenAI o1 and Meta&#8217;s Llama 3.2, particularly in terms of technical specifications and cost advantages, Digit.in <a href="https://www.digit.in/features/general/deepseek-r1-vs-llama-32-vs-chatgpt-o1-which-ai-model-wins.html">reports</a>. 



DeepSeek R1, leveraging a Mixture-of-Experts architecture, activates only a subset of its 671 billion parameters per query to balance efficiency and performance. In contrast, OpenAI o1 prioritizes multi-step reasoning with a 200K context window, and Meta&#8217;s Llama 3.2 offers scalable multimodal capabilities optimized for edge deployments.



Wedbush analyst <a href="https://www.benzinga.com/analyst-ratings/analyst-color/25/01/43236579/chinas-deepseek-ai-rattles-tech-stocks">Daniel Ives remains unconvinced</a> by DeepSeek&#8217;s market impact, noting that while it has gained popularity, major enterprises are unlikely to adopt it over more established solutions from U.S. tech giants.



Also Read: <a href="https://www.benzinga.com/trading-ideas/movers/25/01/43232559/microcloud-hologram-joins-with-deepseek-for-holographic-ai-facilities">MicroCloud Hologram Joins With DeepSeek For Holographic AI Facilities</a>



Why It Matters: DeepSeek R1 stands out with its affordability, being nearly 27.4 times cheaper than proprietary alternatives, making it attractive for cost-sensitive applications. 



However, OpenAI o1 continues to dominate complex problem-solving tasks such as coding and scientific analysis, thanks to its chain-of-thought processing and reinforcement learning techniques. Meta&#8217;s Llama 3.2, on the other hand, caters to multimodal applications, integrating text and image processing for enhanced versatility, according to Digit.in.



Despite DeepSeek&#8217;s rapid rise, industry experts highlight that long-term adoption will depend on enterprise acceptance and broader infrastructure investments. Established players such as Nvidia Corp. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>) and Microsoft Corp. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MSFT#NASDAQ">MSFT</a>) continue to dominate due to their extensive ecosystem support and market reach.



As competition in the AI space heats up, DeepSeek R1&#8217;s emergence underscores the evolving landscape, offering a cost-effective alternative while facing stiff competition from technologically advanced and widely integrated solutions.



Read Next:



<ul>
<li><a href="https://www.benzinga.com/analyst-ratings/analyst-color/25/01/43239042/magnificent-seven-broadcom-lose-nearly-900-billion-in-value-as-deepseek-sparks-ai-carnage-why-this-expert-is-still-bullish-on-us-tech">DeepSeek Sparks AI Carnage As Magnificent Seven, Broadcom Lose Nearly $900 Billion In Value: Why This Expert Is Still &#8216;Bullish&#8217; On US Tech</a></li>
</ul>



Image created using artificial intelligence via Midjourney.

DeepSeek R1 Vs. OpenAI: What Consumers Need To Know About AI's Latest Challenger

A wild selloff rattled tech stocks on Monday, striking at the heart of AI optimism as China&#8217;s DeepSeek startup unveiled an open-source large language model platform that outperforms OpenAI&#8217;s ChatGPT at a <a href="https://www.benzinga.com/analyst-ratings/analyst-color/25/01/43239042/magnificent-seven-broadcom-lose-nearly-900-billion-in-value-as-deepseek-sparks-ai-carnage-why-this-expert-is-still-bullish-on-us-tech">fraction of the cost. </a>



The shockwave hit U.S. markets hard, raising fears over intensifying AI competition just as companies pour heavy investments into the new technology. 



The elite Magnificent Seven stocks collectively shed about $600 billion in market value, with Nvidia Corp. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>) alone erasing $450 billion, or 15% of its valuation. The AI powerhouse is on track for its worst single-day loss since March 18, 2020.



The Nasdaq 100 tumbled 3%, eyeing its steepest drop since Dec. 18, when hawkish comments from Fed Chair Jerome Powell rattled markets. The iShares Semiconductor ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/SOXX#NASDAQ">SOXX</a>) plunged over 7%, also eyeing its worst session since the pandemic-driven selloff of March 2020.



Chipmakers took a beating, with Broadcom Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AVGO#NASDAQ">AVGO</a>) and Marvell Technology Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MRVL#NASDAQ">MRVL</a>) both crashing 17.5%, while Micron Technology Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MU#NASDAQ">MU</a>) sank 11%.



As panic spread, investors sought refuge in safe-haven Treasury assets. Treasury yields slid, with the 10-year yield falling 7 basis points to a one-month low. The U.S. 10-Year Treasury Note ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/UTEN#NASDAQ">UTEN</a>) rose 0.7%. 



The tech turmoil even bled into crypto markets, dragging Bitcoin (CRYPTO: <a class="ticker" href="https://www.benzinga.com/quote/btc/usd">BTC</a>) back below $99,000. The world's largest cryptocurrency lost $110 billion in market cap within hours as risk-off sentiment took hold.



<h3 class="wp-block-heading">Monday&#8217;s Performance In Major US Indices, ETFs</h3>



<figure class="wp-block-table is-style-stripes"><table style="overflow:auto; height: 90px; display: block;"><tbody><tr><td>Major Indices</td><td>Price</td><td>1-day %chg</td></tr><tr><td>Dow Jones</td><td>44,523.61</td><td>0.2%</td></tr><tr><td>Russell 2000</td><td>2,284.39</td><td>-1.0%</td></tr><tr><td>S&amp;P 500</td><td>5,994.21</td><td>-1.8%</td></tr><tr><td>Nasdaq 100</td><td>21,059.65</td><td>-3.3%</td></tr></tbody></table><figcaption class="wp-element-caption">Updated at 12:50 p.m. ET</figcaption></figure>



According to&nbsp;<a href="https://bzresearch.myclickfunnels.com/benzinga-pro-content-webinar-registration/?utm_source=BZprocontent012725&amp;t=be2bearmibe3na1" target="_blank" rel="noreferrer noopener">Benzinga Pro</a>&nbsp;data:



<ul>
<li>The&nbsp;SPDR S&amp;P 500 ETF Trust&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SPY#NYSE">SPY</a>) fell 1.9% to $596.73.</li>



<li>The&nbsp;SPDR Dow Jones Industrial Average&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/DIA#NYSE">DIA</a>)&nbsp;inched 0.2% higher to $445.05.</li>



<li>The tech-heavy&nbsp;Invesco QQQ Trust Series&nbsp;(NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/QQQ#NASDAQ">QQQ</a>) dropped 3.4% to $511.88.</li>



<li>The&nbsp;iShares Russell 2000 ETF&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/IWM#NYSE">IWM</a>) fell 1% to $226.47.</li>



<li>The&nbsp;Consumer Discretionary Select Sector SPDR Fund (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/XLP#NYSE">XLP</a>) outperformed, up 2.2%; the&nbsp;Technology Select Sector SPDR Fund&nbsp;(NYSE:<a class="ticker" href="https://www.benzinga.com/stock/XLE#NYSE">XLE</a>) tumbled, down 5.3%.</li>
</ul>



<h3 class="wp-block-heading">Monday&#8217;s Stock Movers</h3>



<ul>
<li>AT&amp;T Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/T#NYSE">T</a>) soared 6.5% in reaction to stronger-than-expected earnings. </li>



<li>SoFi Technologies Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/SOFI#NASDAQ">SOFI</a>) plummeted 12% as a downbeat guidance darkened better-than-expected quarterly results. </li>



<li>Crypto-related stocks such as MicroStrategy Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MSTR#NASDAQ">MSTR</a>) and Coinbase Global Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/COIN#NASDAQ">COIN</a>) fell by 7.8% and 9.6%, respectively. </li>



<li>Apple Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AAPL#NASDAQ">AAPL</a>) rallied 3%, defying the broader tech selloff. </li>
</ul>



Read now: 



<ul>
<li><a href="https://www.benzinga.com/news/earnings/25/01/43240067/rtx-lockheed-martin-report-q4-earnings-tuesday-doge-concerns-nato-spending-on-watch">RTX, Lockheed Martin Report Q4 Earnings Tuesday: DOGE Concerns, NATO Spending On Watch</a></li>
</ul>



Photo: Shutterstock

Bonds

Broad U.S. Equity ETFs

AAPL

AVGO

COIN

MRVL

MSTR

SOFI

UTEN

Tech Stocks Tumble On AI Nightmare, Nvidia Eyes Worst Day Since March 2020, Bitcoin Drops Below $100,000: What's Driving Markets Monday?

A seismic shift is rattling Wall Street on Monday as China's DeepSeek R1 forces investors to rethink artificial intelligence dominance, sending U.S. <a href="https://www.benzinga.com/25/01/43232316/deepseek-jitters-shatter-us-tech-stocks-wipe-out-12-trillion-on-wall-street-analyst-eyes-four-chinese-giants-set-to-benefit">tech stocks into a free fall. </a>



The Magnificent Seven and Broadcom Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AVGO#NASDAQ">AVGO</a>) have seen nearly $900 billion in market value erased within the first 30 minutes of trading in New York, as concerns grow over lower-cost Chinese AI models threatening America's top tech giants.



<h3 class="wp-block-heading">Tech Bloodbath: Nvidia Leads Selloff</h3>



The Roundhill Magnificent Seven ETF (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/MAGS#NYSE">MAGS</a>) dropped 3.9%, reflecting deep losses across the AI-driven mega-cap space. 



Among the worst hit, Nvidia Corp. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>) collapsed over 10%, erasing $475.81 billion. 



Microsoft Corp. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MSFT#NASDAQ">MSFT</a>) followed with a 3.4% drop, wiping out $130.13 billion, while Broadcom slumped 11.8%, losing $116 billion in value.



<figure class="wp-block-table is-style-stripes"><table style="overflow:auto; height: 90px; display: block;"><thead><tr><th>Company</th><th>Market Cap Loss (USD bn)</th><th>% change</th></tr></thead><tbody><tr><td>Nvidia Corp.</td><td>-475.44</td><td>-10.83%</td></tr><tr><td>Microsoft Corp.</td><td>-130.28</td><td>-3.37%</td></tr><tr><td>Broadcom Inc.</td><td>-116.75</td><td>-11.8%</td></tr><tr><td>Amazon.com Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AMZN#NASDAQ">AMZN</a>)</td><td>-74.63</td><td>-2.79%</td></tr><tr><td>Alphabet Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/GOOG#NASDAQ">GOOG</a>)</td><td>-49.71</td><td>-3.15%</td></tr><tr><td>Tesla Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/TSLA#NASDAQ">TSLA</a>)</td><td>-30.92</td><td>-0.98%</td></tr><tr><td>Meta Platforms Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/META#NASDAQ">META</a>)</td><td>-4.99</td><td>-2.00%</td></tr><tr><td>Apple Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AAPL#NASDAQ">AAPL</a>)</td><td>+53.86</td><td>+2.01%</td></tr><tr><td>Total Market Cap Loss</td><td>&#8211; 829.72</td><td></td></tr></tbody></table><figcaption class="wp-element-caption">Updated at 9:00 a.m. ET</figcaption></figure>



<h3 class="wp-block-heading">DeepSeek Sparks AI Valuation Fears</h3>



The selloff was triggered by concerns that China's DeepSeek R1, an open-source AI model reportedly rivaling top U.S. models at a fraction of the cost, could erode pricing power and future growth prospects for U.S. AI firms. 



&#8220;The Stargate project was launched in part to assert the United States' global AI dominance and prevent China from taking the lead. If China already has the lead and is able to develop comparable AI products with cheaper, less dynamic chips and other inputs, it could result in a radical change in market perceptions,&#8221; analyst Michael Gayed said.



Goldman Sachs analyst Ronald Keung highlighted that cost-efficient Chinese AI firms could rapidly expand their global influence, challenging the massive capital expenditures made by U.S. tech giants.



Yet, not all analysts see this as a long-term negative. 



CJ Muse, a semiconductor analyst at Cantor Fitzgerald, highlighted that DeepSeek's emergence could actually be bullish for Nvidia and the broader AI industry.



&#8220;DeepSeek R1 is actually very bullish for Nvidia,&#8221; Muse said on Bloomberg TV. &#8220;Their announcement means we are closer to AGI (artificial generative intelligence). That's bullish for the ubiquity of AI.&#8221;



Despite the stock plunge, Muse indicates that AI leaders will not cut capital expenditures anytime soon.



&#8220;They are not going to slow down spending. They want to win,&#8221; he said.



Ahead of this week&#8217;s key tech earnings, Muse doesn&#8217;t expect any material change in CapEx announcements from Meta, Microsoft, or Nvidia.



"The market has to digest the news and realize this is not a negative event," the analyst said. 



&#8220;China understands how important AI is for their economy,&#8221; Muse stated, indicating that the tech battle vis-à-vis the U.S. is going to be fierce.



&#8220;I wouldn't never bet against the engineer we have in the U.S.&#8221; he ended. 



<h3 class="wp-block-heading">Major Tech Earnings Reports Loom As AI Investors Seek Clarity</h3>



Four Magnificent Seven companies are reporting earnings this week, with investors closely watching whether AI spending remains robust despite growing competition.



Below are Street&#8217;s earnings-per-share and revenue estimates according to <a href="https://bzresearch.myclickfunnels.com/benzinga-pro-content-webinar-registration/?utm_source=BZprocontent012725&amp;t=be2bearmibe3na1">Benzinga Pro</a> platform:



<figure class="wp-block-table is-style-stripes"><table style="overflow:auto; height: 90px; display: block;"><thead><tr><th>Company</th><th>Earnings Date</th><th>EPS Estimate</th><th>Revenue Estimate (USD bn)</th></tr></thead><tbody><tr><td>Apple </td><td>Jan. 30 (after close)</td><td>2.35</td><td>124.19</td></tr><tr><td>Microsoft</td><td>Jan. 29 (before open)</td><td>3.12</td><td>68.80</td></tr><tr><td>Meta Platforms </td><td>Jan. 29 (before open)</td><td>6.77</td><td>46.99</td></tr><tr><td>Tesla</td><td>Jan. 29 (after close)</td><td>0.74</td><td>27.13</td></tr></tbody></table></figure>



Read Now: 



<ul>
<li><a href="https://www.benzinga.com/markets/cryptocurrency/25/01/43227453/bitcoin-flash-crashes-to-98000-on-china-ai-fears-trump-disappointment">Bitcoin Flash-Crashes To $98,000 On China AI Fears, Trump Disappointment</a></li>
</ul>



Image: Midjourney

GOOG

MAGS

DeepSeek Sparks AI Carnage As Magnificent Seven, Broadcom Lose Nearly $900 Billion In Value: Why This Expert Is Still 'Bullish' On US Tech

Two major defense contractors, RTX Corp. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/RTX#NYSE">RTX</a>) and Lockheed Martin Corp. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/LMT#NYSE">LMT</a>) are set to report fourth-quarter financial results ahead of Tuesday's opening bell. Here's a look at what investors will be watching<a href="https://www.benzinga.com/analyst-ratings/analyst-color/25/01/43181109/trump-calls-for-increased-nato-military-spending-defense-contractors-stand-to-benefit"> in the reports.&nbsp;</a>



RTX: RTX has seen solid <a href="https://www.benzinga.com/25/01/43034421/whats-going-on-with-rtx-corporation-stock-today">order growth</a> due to rising defense budgets. Analysts expect the trend to continue through 2025, despite some expressing concerns about the newly created Department of Government Efficiency. 



Also, President Donald Trump has called for NATO allies to increase military spending to a proposed goal of 5% of GDP, up from the current goal of 2%, which could benefit both RTX and Lockheed Martin.&nbsp;



Read Next:<a href="https://www.benzinga.com/25/01/43196106/rigetti-computing-quantum-stargate"> Rigetti Computing, Quantum Stocks Soar On Project Stargate</a>



Investors will be looking for updates on RTX's defense and aviation business segments, including its F-135 engine core upgrade program. The Pratt &amp; Whitney segment will also be in focus as it reported significant growth in RTX's <a href="https://www.benzinga.com/news/earnings/24/10/41453245/rtx-lifts-2024-outlook-beats-q3-expectations-on-strong-defense-and-commercial-growth">last quarterly</a> report.&nbsp;



Analysts expect RTX, formerly Raytheon, to report quarterly earnings of $1.38 per share on revenue of $20.53 billion, according to data from <a href="https://pro.benzinga.com/?gspk=YWRhbWVja2VydDUzMzY&amp;gsxid=zBMR4PKmcgBw">Benzinga Pro</a>. RTX has exceeded analysts' expectations on the top and bottom lines for seven consecutive quarters. 



LMT: Truist Securities analyst Michael Ciarmoli recently <a href="https://www.benzinga.com/analyst-ratings/initiation/25/01/43010706/doge-fears-for-defense-contractors-lockheed-martin-northrop-grumman-overblown-analyst-says">initiated coverage</a> on Lockheed Martin with a Buy rating and price target of $579, representing significant upside potential from current levels. 



Ciarmoli downplayed DOGE&#8217;s role as only an advisory board and noted that lawmakers and the appropriations committee still &#8220;call the shots&#8221; on budget and spending decisions. He also said Truist sees U.S. and NATO defense budgets increasing in 2026.&nbsp;



Investors will be watching the performance of Lockheed Martin&#8217;s key segments, including aeronautics, missiles and fire control, rotary and mission systems and space systems.



According to estimates from<a href="https://pro.benzinga.com/?gspk=YWRhbWVja2VydDUzMzY&amp;gsxid=zBMR4PKmcgBw"> Benzinga Pro,</a> analysts expect Lockheed Martin to report quarterly earnings of $6.64 per share on revenue of $18.91 billion. The company beat earnings expectations last quarter, but slightly missed the consensus revenue estimate.&nbsp;&nbsp;



Read Next:&nbsp;



<ul>
<li><a href="https://www.benzinga.com/news/large-cap/25/01/43106379/trump-reverses-bidens-ai-policies-on-day-1-what-it-means-for-tech-giants-nvidia-amd-alphabet">Trump Reverses Biden&#8217;s AI Policies On Day 1: What It Means For Tech Giants Nvidia, AMD, Alphabet&nbsp;</a></li>
</ul>



Image: Shutterstock

Earnings

Government

Previews

RTX, Lockheed Martin Report Q4 Earnings Tuesday: DOGE Concerns, NATO Spending On Watch

Stocks are getting <a href="https://www.benzinga.com/25/01/43232316/deepseek-jitters-shatter-us-tech-stocks-wipe-out-12-trillion-on-wall-street-analyst-eyes-four-chinese-giants-set-to-benefit">crushed this morning</a>. Shares of NVIDIA Corporation (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>) are off by more than 10%.



It looks like they may continue to head lower. This is why it is our Stock of the Day.



The catalyst for the selling is news from Chinese startup DeepSeek. It has made investors concerned that America is becoming less competitive in the AI industry.



DeepSeek launched a free open-source large language model. The company claims it was developed for less than $6 million in just two months. Last week DeepSeek released a reasoning model that reportedly outperformed OpenAI's in many tests conducted by third parties.



Read Also: <a href="https://www.benzinga.com/trading-ideas/technicals/25/01/43231443/super-micro-stock-nosedives-as-deepseek-ai-threat-rattles-investors">Super Micro Stock Nosedives As DeepSeek AI Threat Rattles Investors</a>



The move lower in NVIDIA has made it break the support around $129.75. This price action is bearish for stocks and suggests that the shares will continue to fall.



<figure class="wp-block-image size-large"><img loading="lazy" decoding="async" width="1024" height="550" src="https://editorial-assets.benzinga.com/wp-content/uploads/2025/01/27105331/nvda-1024x550.png" alt="" class="wp-image-751607" srcset="https://editorial-assets.benzinga.com/wp-content/uploads/2025/01/27105331/nvda-1024x550.png 1024w,https://editorial-assets.benzinga.com/wp-content/uploads/2025/01/27105331/nvda-300x161.png 300w,https://editorial-assets.benzinga.com/wp-content/uploads/2025/01/27105331/nvda-768x413.png 768w,https://editorial-assets.benzinga.com/wp-content/uploads/2025/01/27105331/nvda.png 1521w" sizes="(max-width: 1024px) 100vw, 1024px" /></figure>



When a stock is declining, it means there are more shares available for sale than there are buyers. To attract buyers, sellers must lower their prices, which drives the stock into a downtrend.



If the stock drops to a support level, the situation changes. There is enough demand to absorb the supply. This is why selloffs end or pause when they reach them.



As you can see on the chart, there has recently been support for NVIDIA around the $130.00 level. The selloffs in December and early January ended when the shares reached this support. Each time, a rebound or rally followed.



Stocks tend to bounce off of support when some of the buyers who created the support become anxious. They are afraid they will be outbid by other buyers. They know the sellers will go to the buyer that is willing to pay the highest price and they don't want to miss the trade.



So, they increase the prices they are willing to pay. Other anxious buyers see this and do the same. It results in a snowball effect that moves the stock higher.



But now the support appears to have broken. The shares are trading below it.



This means the investors and traders who created the support with their buy orders have finished or canceled. With this large amount of demand taken off the market, sellers may be forced to knock the price down to draw them back into the market.



This could force NVIDIA even lower.



Read Next:



<ul>
<li> <a href="https://www.benzinga.com/25/01/43232316/deepseek-jitters-shatter-us-tech-stocks-wipe-out-12-trillion-on-wall-street-analyst-eyes-four-chinese-giants-set-to-benefit">DeepSeek Jitters Shatter US Tech Stocks, Wipe Out $1.2 Trillion On Wall Street: Analyst Eyes Four Chinese Giants Set To Benefit</a></li>
</ul>



Photo: Tigarto/Shutterstock.com

Technicals

Stock Of The Day: Nvidia Breaks Support After DeepSeek AI Disruption

Starbucks Corp (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/SBUX#NASDAQ">SBUX</a>) is brewing up big changes ahead of its <a href="https://www.benzinga.com/quote/SBUX/earnings">first-quarter earnings</a>.



Starting Monday, only paying customers—or those accompanying them—will be allowed to use its cafés, patios, and restrooms. Free water is out, and baristas have been trained to enforce the new rules.



The policy shift comes after North American transactions fell 5% in 2024, marking the first annual drop since the pandemic. Analysts expect same-store sales to decline 4.8% when Starbucks reports earnings on Jan. 28, with estimated EPS at $0.67 and revenue of $9.32 billion, according to <a href="https://bzresearch.myclickfunnels.com/benzinga-pro-content-webinar-registration/?utm_source=BZprocontent012725&amp;t=be2bearmibe3na1">Benzinga Pro</a> data.



Read Also: <a href="https://www.benzinga.com/insights/news/25/01/43084470/if-you-invested-100-in-this-stock-20-years-ago-you-would-have-this-much-today">If You Invested $100 In This Stock 20 Years Ago, You Would Have This Much Today</a>



<h2 class="wp-block-heading">Starbucks Remains Bullish Despite Controversy</h2>



<figure class="wp-block-image size-full"><a href="https://bzresearch.myclickfunnels.com/benzinga-pro-content-webinar-registration/?utm_source=BZprocontent012725&amp;t=be2bearmibe3na1"><img loading="lazy" decoding="async" width="630" height="493" src="https://editorial-assets.benzinga.com/wp-content/uploads/2025/01/27083035/Screenshot-2025-01-27-at-6.34.01-PM.png" alt="" class="wp-image-751214" srcset="https://editorial-assets.benzinga.com/wp-content/uploads/2025/01/27083035/Screenshot-2025-01-27-at-6.34.01-PM.png 630w,https://editorial-assets.benzinga.com/wp-content/uploads/2025/01/27083035/Screenshot-2025-01-27-at-6.34.01-PM-300x235.png 300w" sizes="(max-width: 630px) 100vw, 630px" /></a></figure>



<a class="c-link" data-stringify-link="https://bzresearch.myclickfunnels.com/benzinga-pro-content-webinar-registration/?utm_source=BZprocontent012725&amp;t=be2bearmibe3na1" delay="150" data-sk="tooltip_parent" aria-describedby="sk-tooltip-2103" style="box-sizing: inherit; color: rgba(var(--sk_highlight_hover,11,76,140),1);" href="https://bzresearch.myclickfunnels.com/benzinga-pro-content-webinar-registration/?utm_source=BZprocontent012725&amp;t=be2bearmibe3na1" target="_blank" rel="noopener noreferrer">Chart created using Benzinga Pro</a>



Starbucks' stricter stance is a reversal of its 2018 policy that allowed anyone to use its stores, a decision made after backlash from the arrest of two men at a Philadelphia location. 



While the new crackdown is already sparking debate, investors don't seem rattled, reported <a href="https://www.ft.com/content/a4386eeb-84a2-4011-9d5d-c441e69ddb3f">The Financial Times</a>.



Starbucks stock remains firmly bullish, trading at $98.81, above its key moving averages. The stock is signaling strong buying pressure, with the eight-day, 20-day and 50-day SMAs all pointing to further upside. 



The moving average convergence/divergence (MACD) indicator at 0.98 and a relative strength index (RSI) of 66.69 suggest momentum is on Starbucks' side heading into earnings.



<h2 class="wp-block-heading">Will Earnings Brew A Breakout?</h2>



With expectations already tempered by falling traffic, Starbucks' earnings report could be a key catalyst. 



If sales show signs of stabilizing, the stock's bullish trend may extend. But if the crackdown backfires, investors may have second thoughts about the coffee giant's recovery plan.



Read Next: 



<ul>
<li><a href="https://www.benzinga.com/news/global/25/01/43135622/coffee-prices-soar-to-record-highs-could-starbucks-face-margin-squeeze">Coffee Prices Soar To Record Highs: Could Starbucks Face Margin Squeeze?</a></li>
</ul>



Image: Shutterstock

Restaurants

General

SBUX

Starbucks Cracks Down On Freeloaders As Sales Slide, Stock Stays Bullish Ahead Of Q1 Earnings

Bitcoin (CRYPTO: <a class="ticker" href="https://www.benzinga.com/quote/btc/usd">BTC</a>) on Monday morning briefly tumbled below the $98,000 mark experiencing a significant drop of over 7%, alongside a <a href="https://www.benzinga.com/markets/cryptocurrency/25/01/43203201/donald-trump-has-more-than-50-of-net-worth-in-crypto-will-establish-strategic-bitcoin-rese">wider tech sector sell-off.</a>.



The apex cryptocurrency made a low of $97,791 on Monday morning, before rebounding above $100,000 at the time of writing.



Among other major cryptocurrencies, Solana (CRYPTO: <a class="ticker" href="https://www.benzinga.com/quote/sol/usd">SOL</a>), BNB (CRYPTO: <a class="ticker" href="https://www.benzinga.com/quote/bnb/usd">BNB</a>) and Dogecoin (CRYPTO: <a class="ticker" href="https://www.benzinga.com/quote/doge/usd">DOGE</a>) are trading down 11.5%, 4.4% and 11% respectively, according to data from CoinGecko.



What Happened: In a note sent to Benzinga, Geoffrey Kendrick of Standard Chartered said a 3% decline in Nasdaq futures has driven the digital assets liquidation overnight.



Kendrick emphasized that Bitcoin&#8217;s correlation with the Nasdaq is significantly stronger than its correlation with gold. 



He noted that if the Nasdaq sell-off continues, particularly ahead of this week&#8217;s earnings releases, Bitcoin could approach a critical support level, specifically the average purchase level for Bitcoin ETFs since the presidential election, which now stands at $96,400.



According to <a href="https://www.coinglass.com/LiquidationData">data</a> from CoinGlass, positions worth $883.9 million got liquidated over the last 24 hours, of which 811.3 million were long liquidations.



Also Read: <a href="https://www.benzinga.com/markets/cryptocurrency/25/01/43201211/microstrategy-to-redeem-105b-in-convertible-notes-settles-conversions-with-shares">MicroStrategy To Redeem $1.05B In Convertible Notes, Settles Conversions With Shares</a>



Why It Matters: The dip in Bitcoin also comes after what Kendrick describes as a disappointing announcement from the Trump administration regarding a &#8220;<a href="https://www.benzinga.com/markets/cryptocurrency/25/01/43177482/trump-signs-executive-order-on-crypto-bitcoin-reserve-to-be-evaluated">digital stockpile,</a>&#8221; rather than a more reassuring &#8220;digital reserve,&#8221; which made the community believe that assets would be seized.



He also noted that the executive order from the Trump administration will need congressional approval which will take time. 



"The disappointment for me was two-fold," Kendrick stated. 



He added that this disappointment has reduced the "hope phase" in the market, which could help it transition from "phase 1 to phase 2" in a list of Bitcoin market phases.



Adding further market uncertainty, QCP Capital noted the rise of China&#8217;s Deepseek AI model. 



&#8220;A week into Trump&#8217;s presidency and BTC dipped back below $100,000&#8230; as news of China&#8217;s Deepseek continue to spread from the weekend.&#8221;



The firm highlighted that the Chinese AI technology could disrupt the U.S. equity markets and that the Trump administration may need to take retaliatory steps. 



&#8220;The Chinese LLM poses a potential threat to US equity markets by disrupting U.S. AI dominance&#8230; We&#8217;ll have to wait and see what drastic measures his administration might take to save the US equity market.&#8221;



QCP Capital further noted the market volatility surrounding the upcoming FOMC meeting this Thursday. 



Despite the current dip, QCP believes that Bitcoin will continue to trade within a range. 



They suggest that Bitcoin&#8217;s resilience will be tested this week and anticipate that &#8220;BTC should remain relatively resilient as it continues to trade in this familiar range.&#8221;



What&#8217;s Next: The analysts at Standard Chartered and QCP Capital both suggest potential for a rebound.



Kendrick's analysis notes a significant drop in UST (United States Treasury) yields, which could mean the sell-off has reached its potential floor. 



Kendrick advises investors to "buy the dip." 



Similarly, QCP suggests that &#8220;risk reversals remain skewed in favor of Calls only from March onwards,&#8221; signaling optimism beyond the immediate market turmoil, and that a potential Trump intervention could provide a catalyst for growth.



Read Next: 



<ul>
<li><a href="https://www.benzinga.com/markets/cryptocurrency/25/01/43200132/peter-schiff-trumps-crypto-order-is-an-easy-way-to-pay-off-donors">Peter Schiff: Trump&#8217;s Crypto Order Is An &#8216;Easy Way To Pay Off Donors&#8217;</a></li>
</ul>

$BNB

$SOL

Bitcoin Flash-Crashes To $98,000 On China AI Fears, Trump Disappointment

U.S. tech stocks are crumbling like dry sand in premarket trading Monday as Chinese open-source artificial intelligence platform DeepSeek R1 sparks investor fears over AI competition and capital allocation into <a href="https://www.benzinga.com/markets/equities/25/01/43221806/nvidia-amd-broadcom-smci-tsmc-and-other-tech-giants-lead-monday-pre-market-selloff-as-nasdaq-100-futures-plummet-over-650-points-amid-reports-of-chinese-ai-startup-deepseek-overtaking-chatgpt">high-cost American firms.</a>



Futures on the Nasdaq 100 plunged 4% as of 8:00 a.m. ET, setting the stage for their worst session since September 2022. 



Semiconductor stocks, the backbone of AI development, are bearing the brunt of the selloff, with AI darling Nvidia Corp. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>) plunging 12%, potentially eyeing its worst day since March 18, 2020.



The iShares Semiconductor ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/SOXX#NASDAQ">SOXX</a>) is down 4.5%, with heavy losses also hitting Marvell Technology Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MRVL#NASDAQ">MRVL</a>), down 13%, Broadcom Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AVGO#NASDAQ">AVGO</a>), down 11%, and Arm Holdings plc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/ARM#NASDAQ">ARM</a>), down 9.5%.



AI infrastructure and data center stocks are also seeing steep declines, with GE Vernova Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/GEV#NYSE">GEV</a>) plummeting 14%, Vistra Corp. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/VST#NYSE">VST</a>) and Constellation Energy Corp. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/CEG#NASDAQ">CEG</a>) both sliding 11.5%, and Arista Networks Inc. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/ANET#NYSE">ANET</a>) falling 10%.



The S&amp;P 500 is not immune to the fallout, with futures on the index falling 2.2%, while the Dow Jones Industrial Average is inching 0.8% lower due to its smaller exposure to tech. 



With AI stocks leading market gains over the past year, today's rout threatens to wipe out $1.2 trillion in market capitalization.



<h3 class="wp-block-heading">DeepSeek: A Game-Changer In AI?</h3>



DeepSeek R1, an open-source AI model, is reportedly rivaling top U.S. AI models at a fraction of the cost, leveraging lower-power NVIDIA chips to bypass U.S. export restrictions.



&#8220;DeepSeek has produced a large language model that rivals many of the leading U.S. offerings. And they've done it at a fraction of the cost, using less powerful chips,&#8221; said David Morrison, senior market analyst at Trade Nation.



Investors are now questioning whether AI software firms can sustain their pricing models. 



Bloomberg Intelligence analyst Mandeep Singh highlighted that OpenAI charges $200 per month for its premium subscription, raising doubts about its pricing power if open-source alternatives offer similar or superior performance at a significantly lower cost.



&#8220;How do you justify that cost if an open-source platform does it better?&#8221; Singh said.



With billions in capital expenditures planned for 2025-2027, any shift in corporate spending could redefine the trajectory of AI investing.



&#8220;I don't think they are walking back on 2025 capex,&#8221; Singh added, dismissing the idea that companies would scale back investments immediately.



The AI frenzy that has propelled the &#8220;Magnificent Seven&#8221; stocks to record highs is now facing its biggest test. With major U.S. tech earnings due this week, investors are demanding answers.



&#8220;If the Mag-7&#8217;s Q4 earnings disappoint, these seven stocks could drag the S&amp;P 500 down significantly since they account for a whopping 30.5% of the market cap of the index,&#8221; warned Ed Yardeni, President of Yardeni Research.



<h3 class="wp-block-heading">Chinese Stocks To Watch</h3>



In a note on Sunday, Goldman Sachs analyst Ronald Keung highlighted that DeepSeek's breakthrough could lower barriers to entry in AI, paving the way for increased global competition. 



&#8220;We believe increasingly agile Chinese models and significant improvement in computing cost efficiencies could drive further room for wider adoption, exploration, and proliferation of AI applications,&#8221; Keung said.



He also indicated the potential for Chinese AI firms to expand their influence, pointing to companies like Alibaba Group Holding Ltd. (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/BABA#NYSE">BABA</a>), China's largest cloud provider, and Tencent Holdings (OTC:<a class="ticker" href="https://www.benzinga.com/stock/TCEHY#OTC">TCEHY</a>), which has deep AI integration within its WeChat ecosystem.



According to Keung, also data centers GDS Holdings Ltd. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/GDS#NASDAQ">GDS</a>) and Vnet Group Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/VNET#NASDAQ">VNET</a>) are expected to &#8220;benefit from ongoing public cloud and AI computing demand growth from multi-year higher AI adoption.&#8221;



Now Read: 



<ul>
<li><a href="https://www.benzinga.com/tech/25/01/43223228/satya-nadella-said-we-should-take-development-out-of-china-very-very-seriously-now-deepseeks-r1-has-emerged-as-chatgpt-killer-outperforming-openai-with-50x-cheaper-prices-heres-more">Satya Nadella Said &#8216;We Should Take Development Out Of China Very, Very Seriously.&#8217; Now, DeepSeek&#8217;s R1 Has Emerged As A ChatGPT Killer, Outperforming OpenAI With 50x Lower Costs: Here&#8217;s More</a></li>
</ul>



Image: Shutterstock

BABA

TCEHY

VNET

DeepSeek Jitters Shatter US Tech Stocks, Wipe Out $1.2 Trillion On Wall Street: Analyst Eyes Four Chinese Giants Set To Benefit

Satya Nadella-led Microsoft Corp. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MSFT#NASDAQ">MSFT</a>) has bet its AI ambitions on OpenAI, pouring billions of dollars into the Sam Altman-led startup. Now, days after he said the China threat needs to be taken seriously, DeepSeek, a China-based AI startup, has beaten OpenAI with 97% less computing power and 50 times lower prices.



What Happened: DeepSeek R1 employs a hybrid architecture that incorporates large-scale reinforcement learning and chain-of-thought reasoning to improve response accuracy.



It is available in two versions: DeepSeek-R1 and DeepSeek-R1-Zero, with the latter featuring unsupervised fine-tuning for superior reasoning skills.



The startup, based in Hangzhou, China, was founded by&nbsp;Liang Wenfeng&nbsp;in July 2023, with the goal of developing&nbsp;advanced AI capable of performing&nbsp;tasks at or beyond human-level&nbsp;proficiency.



The model&#8217;s affordability is a significant attraction, with pricing lower by up to 50 times than OpenAI&#8217;s offerings.



Subscribe to the&nbsp;<a href="https://bztechtrends.beehiiv.com/subscribe" target="_blank" rel="noreferrer noopener">Benzinga Tech Trends newsletter</a>&nbsp;to get all the latest tech developments delivered to your inbox.



DeepSeek R1 has demonstrated comparable&nbsp;performance to OpenAI&#8217;s models in various benchmarks, even outperforming them in certain coding tasks.



Speaking at the World Economic Forum, Microsoft CEO Nadella said, "We should take the developments out of China very, very seriously."



So far, DeepSeek has released six smaller versions of the R1 model, optimized for laptop use, with one surpassing OpenAI&#8217;s o1-mini in specific tests.



See Also: <a href="https://www.benzinga.com/25/01/43215631/amazon-prime-video-shifts-focus-to-live-sports-looks-to-become-profitable-by-end-of-2025">Amazon Prime Video Shifts Focus To Live Sports, Looks To Become Profitable By End Of 2025</a>



The&nbsp;launch of DeepSeek R1 has&nbsp;sparked discussions on social media, with users sharing experiences and comparisons with other AI models.



The model&#8217;s&nbsp;rapid development, competitive pricing, and&nbsp;open-source initiatives highlight China&#8217;s growing influence&nbsp;in the global AI landscape.



Why It Matters: The introduction of DeepSeek R1 has significant implications for the global AI market. The startup created its low-cost model in just two months with less than $6 million, showcasing China&#8217;s potential to challenge major players like OpenAI, Alphabet Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/GOOG#NASDAQ">GOOG</a>) (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/GOOGL#NASDAQ">GOOGL</a>) Google, and Meta Platforms Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/META#NASDAQ">META</a>).



The model has overtaken ChatGPT as the most downloaded app on Apple&#8217;s US store, indicating its growing popularity.



The launch has also impacted the stock market, with major technology stocks experiencing a selloff. Stocks of&nbsp;Nvidia Corp.&nbsp;(NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>) and&nbsp;Broadcom Inc.&nbsp;(NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AVGO#NASDAQ">AVGO</a>) <a href="https://www.benzinga.com/markets/equities/25/01/43221806/nvidia-amd-broadcom-smci-tsmc-and-other-tech-giants-lead-monday-pre-market-selloff-as-nasdaq-100-futures-plummet-over-650-points-amid-reports-of-chinese-ai-startup-deepseek-overtaking-chatgpt">saw significant declines</a> as DeepSeek&#8217;s model threatened U.S. technological leadership.



Moreover, the development has <a href="https://www.benzinga.com/25/01/43220297/nvidia-stock-slide-as-chinas-deepseek-ai-sparks-doubts-over-gpu-spending-frenzy-what-tech-experts-are-saying">raised questions</a> about the necessity of massive GPU investments. DeepSeek&#8217;s open-source approach and technical report suggest that advanced AI systems can be developed on substantially smaller budgets, challenging the current industry norms.



Check out more of Benzinga's Consumer Tech coverage by&nbsp;<a href="https://www.benzinga.com/topic/consumer-tech" target="_blank" rel="noreferrer noopener">following this link</a>.



Read Next:



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<li><a href="https://www.benzinga.com/25/01/43153571/openais-sam-altman-flip-flops-on-trump-as-500-billion-stargate-ai-project-is-announced-years-after-praising-reid-hoffman-for-stopping-his-re-election">OpenAI&#8217;s Sam Altman Flip Flops On Trump After $500 Billion Stargate AI Project, Says &#8216;I Wish I Had Done More Of My Own Thinking&#8217;</a></li>
</ul>



Disclaimer:&nbsp;This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.



Photos courtesy: Shutterstock

GOOGL

Satya Nadella Said 'We Should Take Development Out Of China Very, Very Seriously.' Now, DeepSeek's R1 Has Emerged As A ChatGPT Killer, Outperforming OpenAI With 50x Lower Costs: Here's More

Major technology stocks plunged in Monday&#8217;s pre-market trading after Chinese artificial intelligence startup DeepSeek unveiled an AI model that reportedly matches OpenAI&#8216;s ChatGPT capabilities at a <a href="https://www.benzinga.com/25/01/43220297/nvidia-stock-slide-as-chinas-deepseek-ai-sparks-doubts-over-gpu-spending-frenzy-what-tech-experts-are-saying">fraction of the cost</a>, threatening U.S. technological leadership.



What Happened: NVIDIA Corp (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>) led the decline, falling 8.15% to $131.00 in pre-market trading. Other chip manufacturers followed, with Broadcom Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AVGO#NASDAQ">AVGO</a>) down 8.66%, Super Micro Computer Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/SMCI#NASDAQ">SMCI</a>) dropping 8.03%, and Taiwan Semiconductor Manufacturing Company (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TSM#NYSE">TSM</a>) declining 7.66%.



Advanced Micro Devices Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AMD#NASDAQ">AMD</a>) shed 4.89%, while Micron Technology Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MU#NASDAQ">MU</a>) lost 6.00%. Intel Corp (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/INTC#NASDAQ">INTC</a>) and Qualcomm Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/QCOM#NASDAQ">QCOM</a>) showed relatively smaller declines of 2.45% and 2.28%, respectively.



The selloff extended to major tech companies, with Microsoft Corp (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MSFT#NASDAQ">MSFT</a>) falling 3.30%, Meta Platforms Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/META#NASDAQ">META</a>) down 3.22%, and Alphabet Inc. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/GOOGL#NASDAQ">GOOGL</a>) (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/GOOG#NASDAQ">GOOG</a>) declining over 3%.



DeepSeek&#8217;s R1 language model, released as open-source last week, reportedly achieves performance comparable to OpenAI&#8217;s models while requiring significantly less computing power. The startup claims to use approximately 50,000 Nvidia H100 GPUs, raising questions about the necessity of massive GPU investments that have driven chip stocks&#8217; valuations.



See Also: <a href="https://www.benzinga.com/markets/cryptocurrency/25/01/43221668/mini-financial-crisis-for-crypto-incoming-arthur-hayes-predicts-bitcoin-dropping-to-75k-before-skyrocketing-to-250k-by-year-end">&#8216;Mini Financial Crisis&#8217; For Crypto Incoming? Arthur Hayes Predicts Bitcoin Dropping To $75K Before Skyrocketing To $250K By Year-End</a>



Why It Matters: Scale AI CEO Alexandr Wang called DeepSeek &#8220;a wake-up call for America&#8221; on social media platform X, emphasizing the need for the U.S. to accelerate innovation while strengthening <a href="https://www.benzinga.com/25/01/43220297/nvidia-stock-slide-as-chinas-deepseek-ai-sparks-doubts-over-gpu-spending-frenzy-what-tech-experts-are-saying">chip export controls</a>.



According to The Kobeissi Letter, U.S. markets are set to erase over $1 trillion in market capitalization during Monday&#8217;s session, with Nasdaq 100 futures plunging 662.50 points or 3.2%, and S&amp;P 500 futures dropping 1.9% as of early morning trading.



<figure class="wp-block-embed is-type-rich is-provider-twitter wp-block-embed-twitter"><div class="wp-block-embed__wrapper">
<blockquote class="twitter-tweet" data-width="500" data-dnt="true">Chip Stocks Overnight Reaction to DeepSeek: 1. Arm, <a href="https://twitter.com/search?q=%24ARM&amp;src=ctag&amp;ref_src=twsrc%5Etfw">$ARM</a>: -5.5% 2. Nvidia, <a href="https://twitter.com/search?q=%24NVDA&amp;src=ctag&amp;ref_src=twsrc%5Etfw">$NVDA</a>: -5.3% 3. Broadcom, <a href="https://twitter.com/search?q=%24AVGO&amp;src=ctag&amp;ref_src=twsrc%5Etfw">$AVGO</a>: -4.9% 4. Super Micro, <a href="https://twitter.com/search?q=%24SMCI&amp;src=ctag&amp;ref_src=twsrc%5Etfw">$SMCI</a>: -4.6% 5. Taiwan Semi, <a href="https://twitter.com/search?q=%24TSM&amp;src=ctag&amp;ref_src=twsrc%5Etfw">$TSM</a>: -4.5% 6. Micron, <a href="https://twitter.com/search?q=%24MU&amp;src=ctag&amp;ref_src=twsrc%5Etfw">$MU</a>: -4.3% 7. Qualcomm, <a href="https://twitter.com/search?q=%24QCOM&amp;src=ctag&amp;ref_src=twsrc%5Etfw">$QCOM</a>: -2.8% 8. AMD, <a href="https://twitter.com/search?q=%24AMD&amp;src=ctag&amp;ref_src=twsrc%5Etfw">$AMD</a>: -2.5% 9. Intel, <a href="https://twitter.com/search?q=%24INTC&amp;src=ctag&amp;ref_src=twsrc%5Etfw">$INTC</a>: -2.0% US markets are…&mdash; The Kobeissi Letter (@KobeissiLetter) <a href="https://twitter.com/KobeissiLetter/status/1883709301258068240?ref_src=twsrc%5Etfw">January 27, 2025</a></blockquote><script async src="https://platform.twitter.com/widgets.js" charset="utf-8"></script>
</div></figure>



The development comes at a crucial time as markets await the Federal Reserve&#8217;s meeting this week and major earnings reports. DeepSeek&#8217;s breakthrough particularly threatens Nvidia&#8217;s market position, as the company&#8217;s chips have been considered essential for advanced AI development.



Adding to market pressure, billionaire investor Chamath Palihapitiya highlighted that DeepSeek has achieved step-by-step reasoning without requiring massive supervised datasets, potentially marking a significant advancement in AI technology.



Read next: 



<ul>
<li><a href="https://www.benzinga.com/25/01/43220101/bitcoin-ethereum-dogecoin-plummet-alongside-stock-futures-amid-trumps-tariff-war-deepseek-hype-top-trader-predicts-bitcoins-upside-to-122000">Bitcoin, Ethereum, Dogecoin Fall With Stock Futures Amid Trump Tariff War, DeepSeek Hype: Top Trader Predicts Bitcoin&#8217;s Upside To $122,000</a></li>
</ul>



Image Via Shutterstock 



Disclaimer:&nbsp;This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.



Image Via Shutterstock

INTC

QCOM

SMCI

Nvidia, AMD, Broadcom, SMCI, TSMC And Other Tech Giants Lead Monday Pre-Market Selloff As Nasdaq 100 Futures Plummet Over 650 Points Amid Reports Of Chinese AI Startup DeepSeek Overtaking ChatGPT

U.S. stock futures dropped sharply on Monday after the <a href="https://www.benzinga.com/tech/25/01/43223228/satya-nadella-said-we-should-take-development-out-of-china-very-very-seriously-now-deepseeks-r1-has-emerged-as-chatgpt-killer-outperforming-openai-with-50x-cheaper-prices-heres-more">rise in the popularity of DeepSeek</a>, a Chinese artificial intelligence model that demonstrates high performance at a significantly lower cost. This development sent shockwaves through the market, challenging the belief that massive GPU investments are necessary for powerful AI, particularly threatening big tech companies.



All major index futures were down, with the Nasdaq 100 falling more than 4.3%. This drop comes after the indices had posted gains for two consecutive weeks.



Apart from this, five of the total ‘Magnificent Seven' will report their earnings this week.



The 10-year Treasury yield stood at 4.50%, while the two-year yield was at 4.17%. According to the CME Group's FedWatch <a href="https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html">tool</a>, there is a 99.5% chance that the Federal Reserve will keep interest rates unchanged later this week. 



<figure class="wp-block-table is-style-stripes"><table style="overflow:auto; height: 90px; display: block;"><tbody><tr><td>Futures</td><td>Change (+/-)</td></tr><tr><td>Nasdaq 100</td><td>-4.38%</td></tr><tr><td>S&amp;P 500</td><td>-2.43%</td></tr><tr><td>Dow Jones</td><td>-0.87%</td></tr><tr><td>Russell 2000</td><td>-1.12%</td></tr></tbody></table></figure>



The SPDR S&amp;P 500 ETF Trust (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/SPY#NYSE">SPY</a>) and Invesco QQQ Trust ETF (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/QQQ#NASDAQ">QQQ</a>) both experienced negative premarket trading on Thursday. SPY fell 2.36% to $593.6, and QQQ plunged 4.10% to $507.92, according to <a href="https://pro.benzinga.com/dashboard">Benzinga Pro</a> data.



Cues From The Last Session



U.S. stocks ended <a href="https://www.benzinga.com/news/earnings/25/01/43221827/sp-500-retreats-after-hitting-fresh-records-investor-sentiment-improves-but-fear-greed-index-remains-in-neutral-zone">lower</a>, with the S&amp;P 500 retreating after hitting record highs on Friday. Nvidia Corp. (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>) dropped more than 3%, and Tesla Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/TSLA#NASDAQ">TSLA</a>) fell over 1%. However, all three major indices posted their second consecutive positive week, with the S&amp;P 500 and Nasdaq rising 1.7%, and the Dow up 2.2%.



Twilio Inc (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/TWLO#NYSE">TWLO</a>) shares surged over 20% following strong Q4 guidance and a revenue increase, prompting analysts to raise price targets.



Economic data showed the S&amp;P Global Services PMI dropped to 52.8 in January, while the Manufacturing PMI rose to 50.1. Most S&amp;P 500 sectors closed higher, with gains in communication services, utilities, and consumer staples. However, tech and energy stocks declined.



The Dow fell 140 points or 0.32% to 44,424.25, the S&amp;P 500 lost 0.29% to 6,101.24, and the Nasdaq Composite dropped 0.50% to 19,954.30. Russell 2000 Index slipped 0.30% to 2,307.74.



<figure class="wp-block-table is-style-stripes"><table style="overflow:auto; height: 90px; display: block;"><tbody><tr><td>Index</td><td>Performance (+/-)</td><td>Value</td></tr><tr><td>Nasdaq Composite</td><td>-0.50%</td><td>19,954.30</td></tr><tr><td>S&amp;P 500</td><td>-0.29%</td><td>6,101.24</td></tr><tr><td>Dow Jones</td><td>-0.32%</td><td>44,424.25</td></tr><tr><td>Russell 2000</td><td>-0.30%</td><td>2,307.74</td></tr></tbody></table></figure>



Insights From Analysts



Assessing the DeepSeek impact, the global macroeconomic expert and market strategist, Anish Nanda said that the speed, cost, and focus of China's progress on chips is causing a rotation out of growth into value stocks.



However, he added that it remains to be seen if DeepSeek will prove to be a viable, cheaper alternative in the long term and if they can consistently innovate and take a leadership position in the sector that can be sustained. "Also little is known about the lab and its founder, Liang WenFeng," he told <a href="https://pro.benzinga.com/dashboard">Benzinga</a>.



"Nevertheless, it still poses a risk if U.S. tech giants' pricing power is finally being threatened and if their massive AI spending needs a rethink. Only time will tell who will emerge the winner in the long run. A tough battle seems to be on the cards.&#8221;



Ed Yardeni and Eric Wallerstein of Yardeni Research pointed out that this week will see a slew of big tech companies report their earnings.



"The next round of fun begins this week and next week when the Magnificent-7 report Q4 results," the note said.



Microsoft Corporation (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MSFT#NASDAQ">MSFT</a>), Tesla Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/TSLA#NASDAQ">TSLA</a>), and Meta Platforms Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/META#NASDAQ">META</a>) will report earnings on Wednesday, Jan. 29. Apple Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AAPL#NASDAQ">AAPL</a>) and Amazon.com Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AMZN#NASDAQ">AMZN</a>) will report on Thursday, Jan. 30.



Whereas Alphabet Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/GOOG#NASDAQ">GOOG</a>) (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/GOOGL#NASDAQ">GOOGL</a>) will report on Tuesday, Feb. 4, Nvidia Corporation (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>), on the other hand, won&#8217;t report until Feb. 26.



"The question is whether they will disappoint because their capital spending on AI is soaring faster than their revenues. That could squeeze their collective profit margin. The forward profit margin of the Mag-7 has soared from 18.0% at the start of 2023 to 25.5% during the Jan. 25 week," the note added.



As per the CME's FedWatch <a href="https://www.cmegroup.com/markets/interest-rates/cme-fedwatch-tool.html">tool</a>, the probability of having no change in the rates was at 65.6% for March and 44.4% for May.



Talking about this and Bank of Japan's hike last week, the CEO of Mind Money Julia Khandoshko said, "In the current environment of global monetary uncertainty, with no clear timeline for when the Federal Reserve might further continue its easing rates, the BoJ's decision looks like a calculated response to economic challenges."



See Also: <a href="https://www.benzinga.com/money/how-to-trade-futures">How to Trade Futures </a>



Upcoming Economic Data



Here&#8217;s what investors will keep an eye on for the week:



<ul>
<li>On Monday, December's new home sales will be announced at 10:00 a.m., ET.</li>



<li>On Tuesday, durable goods orders data for December will be out by 8:30 a.m., ET.</li>



<li>November's S&amp;P Case-Shiller home price index for 20 cities will be released at 9:00 a.m., ET.</li>



<li>Consumer confidence data for January will be announced at 10:00 a.m., ET.</li>



<li>On Wednesday, December's data for advanced U.S. trade balance in goods, advanced retail inventories, and advanced wholesale inventories will be released at 8:30 a.m., ET.</li>



<li>The FOMC interest-rate decision will be out at 2:00 p.m. and Chairman Jerome Powell will address a press conference at 2:30 p.m., ET.</li>



<li>On Thursday, the GDP data for the first quarter and the initial jobless claims data till Jan. 25, will be released at 8:30 a.m. ET.</li>



<li>December's pending home sales will be out at 10:00 a.m., ET.</li>



<li>On Friday, employment cost index data for Q4 will be released at 8:30 a.m., ET.</li>



<li>Fed Governor Michelle Bowman will be speaking at 8:30 a.m., ET.</li>



<li>Also, the core and headline personal consumption expenditure, along with personal income and spending data will be announced at 8:30 a.m., ET.</li>



<li>The Chicago Business Barometer (PMI) for January will be out by 9:45 a.m., ET.</li>
</ul>



Stocks In Focus:



<ul>
<li>AT&amp;T Inc (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/T#NYSE">T</a>) was up 1.23% in premarket on Monday ahead of its earnings before the opening bell. Analysts expect it to report quarterly earnings of 50 cents per share on revenue of $32.04 billion.</li>



<li>Nucor Corp (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/NUE#NYSE">NUE</a>) was down 0.87% as Wall Street expects it to report quarterly earnings of 65 cents per share on revenue of $6.76 billion after the closing bell.</li>



<li>Brown &amp; Brown Inc (NYSE:<a class="ticker" href="https://www.benzinga.com/stock/BRO#NYSE">BRO</a>) was up 0.94% ahead of its earnings slated to be announced after the closing bell. Analysts expect it to report quarterly earnings of 77 cents per share on revenue of $1.12 billion.</li>



<li>Sanmina Corp (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/SANM#NASDAQ">SANM</a>) was up 0.05% as Wall Street expects it to report quarterly earnings of $1.36 per share on revenue of $1.98 billion during market hours.</li>



<li>Logility Supply Chain Solutions Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/LGTY#NASDAQ">LGTY</a>) was up 23.85% after Aptean announced an agreement to acquire Logility in a $14.30-per-share all-cash deal.</li>



<li>Following the DeepSeek development, Microsoft Corporation (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/MSFT#NASDAQ">MSFT</a>) was down 7.22%, Tesla Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/TSLA#NASDAQ">TSLA</a>) slipped 4.54%, and Meta Platforms Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/META#NASDAQ">META</a>) declined 5.94%. Also, Apple Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AAPL#NASDAQ">AAPL</a>) and Amazon.com Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/AMZN#NASDAQ">AMZN</a>) dropped by 0.35% and 5.68%, respectively.</li>



<li>Alphabet Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/GOOG#NASDAQ">GOOG</a>) plunged 4.30% and Nvidia Corporation (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/NVDA#NASDAQ">NVDA</a>) plummeted 11.81% in premarket.</li>



<li>Tevogen Bio Holdings Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/TVGN#NASDAQ">TVGN</a>) was up 53.33% after the company expanded collaboration with Microsoft to advance AI-Powered PredicTcell Technology on Azure.</li>



<li>HWH International Inc (NASDAQ:<a class="ticker" href="https://www.benzinga.com/stock/HWH#NASDAQ">HWH</a>) was up 14.70% after it received a notice on Jan. 23 from the Nasdaq Stock Market, informing the company that it has demonstrated compliance with Nasdaq's Listing Rule 5550(b).</li>
</ul>



Commodities, Gold And Global Equity Markets:



Crude oil futures were trading lower in the early New York session by 0.20% to hover around $74.51 per barrel.



The gold spot index was down by 0.08% to $2,768.92 per ounce. The Dollar Index was down 0.24% at 107.181 level.



Asian markets closed mixed on Monday as Hong Kong's Hang Seng, Australia's ASX 200, and South Korea's Kospi index rose. Whereas, India's S&amp;P BSE Sensex, China's CSI 300, and Japan's Nikkei 225 index fell. European markets were lower in trade.



Read Next:



<ul>
<li><a href="https://www.benzinga.com/general/market-summary/25/01/43222490/michael-saylors-microstrategy-plummets-over-5-in-pre-market-as-chinese-ai-startup-deepseek-sends-shockwaves-through-crypto-universe-btc-falls-5-dipping-below-100k">Michael Saylor&#8217;s MicroStrategy Plummets Over 5% In Pre-Market As Chinese AI Startup DeepSeek Sends Shockwaves Through Crypto Universe: BTC Falls 5%, Dipping Below 100K </a></li>
</ul>



Photo courtesy: Shutterstock

Futures

Pre-Market Outlook

LGTY

SANM

TVGN

TWLO

US Stock Futures Tumble As DeepSeek Buzz Jolts Big Tech: Expert Says The Chinese AI Model Is Yet To Prove Its Viability At Lower Cost In Long Term

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