Global investors sold off tech stocks on Monday, spurred by concerns that the rise of a low-cost Chinese artificial intelligence model could threaten the dominance of industry leaders like Nvidia (NVDA.O). This sell-off wiped out $593 billion from Nvidia's market value, setting a record for the largest one-day loss for any company on Wall Street.

The downturn followed last week’s launch of a free AI assistant by Chinese startup DeepSeek. The company claims its model uses less data and operates at a fraction of the cost of existing services. By Monday, the assistant had surpassed U.S.-based ChatGPT in downloads from Apple’s (AAPL.O) App Store. This development caused the tech-heavy Nasdaq (.IXIC) to drop 3.1% on Monday, with Nvidia leading the decline, as its shares plummeted nearly 17%. This marked a record one-day market-cap loss for a Wall Street stock, according to LSEG data.

Nvidia’s loss on Monday was more than double its previous one-day record set last September. Other significant drags on the Nasdaq included chipmaker Broadcom Inc (AVGO.O), which fell 17.4%, Microsoft (MSFT.O), the backer of ChatGPT, which declined 2.1%, and Alphabet (GOOGL.O), Google’s parent company, which dropped 4.2%. “If it’s true that DeepSeek is the proverbial ‘better mousetrap,’ that could disrupt the entire AI narrative that has helped drive the markets over the last two years,” said Brian Jacobsen, chief economist at Annex Wealth Management in Menomonee Falls, Wisconsin. “It could mean less demand for chips, less need for a massive build-out of power production to fuel the models, and less need for large-scale data centers.”