A new Chinese AI model threatens to diminish the need for Nvidia’s most-expensive chips, but some say the concerns are overblown.

In case there’s any question, under no circumstances is Nvidia about to lose its market dominance due to a Chinese software app. In fact, the U.S. stock market’s deep dive on Monday because of DeepSeek gives you a chance to load up on Nvidia and power-grid stocks.

A new Chinese AI model threatens to diminish the need for Nvidia’s most-expensive chips, but some say the concerns are overblown.

Chinese startup DeepSeek has achieved what many (including experts) thought impossible: create a foundational, competitive AI model for just $5.6 million. By comparison, OpenAI’s unreleased GPT-5 (codenamed “Orion”) reportedly requires $500 million for six months of training.

Nvidia staged a moderate rebound on Tuesday, rising as much as 3%, following a 17% drop the prior day. More broadly, major US indexes rallied after the S&P 500 and Nasdaq 100 saw sharp losses on Monday amid concerns over the Chinese AI firm DeepSeek's rapid and seemingly cost-effective advances.