DeepSeek correction causes tech stocks to drop, Fed monitoring situation

From Investing.com: 2025-01-28 04:40:00

Tech stocks experienced a major sell-off due to the DeepSeek correction, raising questions about AI development and the ‘Magnificent 7’ tech players. DeepSeek’s free-to-air AI model poses a threat to traditional rivals, challenging the need for high computing power and impacting revenue expectations. The Fed watches closely for effects on consumer spending and corporate financing, with potential rate cuts if a broader correction occurs. The Nasdaq sell-off led to defensive FX reactions and increased market pricing of Fed easing. Treasury yields may react lower with sustained stock declines. Overall, the market remains cautious but watchful for further developments.



Read more at Investing.com: DeepSeek Threat Sends Tech Stocks Tumbling and the Fed Will Be Watching