Chinese AI advancement called DeepSeek is sending US stocks plunging [Video]

US stocks were set for a steep selloff Monday morning after a surprise advancement from a Chinese artificial intelligence company, DeepSeek, threatened the aura of invincibility surrounding America’s technology industry.

DeepSeek, a one-year-old startup, last week showed off a stunning capability: It presented a ChatGPT-like AI model called R1, which has all the familiar abilities, operating at a fraction of the cost of OpenAI’s, Google’s or Meta’s popular AI models. The company said it had spent just $5.6 million training its newest AI model, compared with the hundreds of millions or billions of dollars US companies spend on their AI technologies.

That sent shockwaves through the tech sector Monday. Meta last week said it would spend upward of $65 billion this year on AI development. Sam Altman, CEO of OpenAI, last year said the AI industry would need trillions of dollarsin investment to support the development of in-demand chips needed to …