GLOBAL MARKETS-Share markets stabilise in nervy trading after DeepSeek selloff

By Tom Westbrook and Alun John

SINGAPORE/LONDON, Jan 28 (Reuters) - U.S. stock futures and European shares steadied on Tuesday, after the previous day's dramatic, tech-led selloff, and investors walked back some moves to safe-haven government bonds, though traders across asset classes remained jittery.

Chipmaker Nvidia NVDA.O dived 17% on Monday, wiping off nearly $593 billion in the biggest market capitalisation loss in histoy, and the Philadelphia semiconductor index .SOX, down 9.2%, notched its biggest loss since March 2020,

Behind the rout was the emergence of a low-cost Chinese artificial intelligence model that made investors question the dominance of AI bellwethers and their suppliers, which have sent shares of tech names and chip firms soaring.

In a sign that Tuesday might be a little calmer Nvidia rose around 5% in premarket trading, NVDA.F Nasdaq futures were 0.5% higher, and European tech stocks .SX8P were last flat on the day.

But it was not all calm, as selling pressure remained in Japan for a second day with Nvidia supplier Advantest 6857.T now down 19% in two days, and investors and strategists continued to grapple with what it all meant. .T

"We are on the front edge of an urgent re-evaluation of a narrative that has gripped the market for almost two years. That makes it hard to shrug off after 36 hours," said Brent Donnelly, president of trading and analytics firm Spectra Markets.

The news also will add even more investor attention to this week's earnings at Microsoft MSFT.O, Tesla TSLA.O and Meta META.O. Executives can expect to be asked whether they still plan to spend so much on computing power.

U.S. Treasuries, which rallied on Monday as part of the risk off move, reversed course and benchmark 10 year yields US10YT=RR were last four basis points higher at 4.57%. US/

European benchmark, the German 10 year Bund yield DE10YT=RR rose 2 bps to 2.55%, and the broad European share benchmark .STOXX the Stoxx 600 rose 0.5%. GVD/EUR .EU

Safe haven currencies, particularly the Japanese yen and Swiss franc, which gained sharply on Monday as part of the risk off mood reversed course on Tuesday.

The dollar was last up 0.84% on the yen at 155.78 yen, JPY=EBS and 0.5% on the franc at 0.9062. CHF=EBS FRX/

While the emergence of DeepSeek, a little-known startup from Hangzhou, China, gave investors something to think about other than President Donald Trump's policies particularly on tariffs, trade tensions remained in the mix, and also supported the dollar.

New U.S. Treasury Secretary Scott Bessent is pushing for a gradual rise in universal tariffs starting from 2.5%, and potentially up to 20%, the Financial Times reported, and Trump later said that he wants “much bigger” tariffs than 2.5% and is considering targeted duties on products like steel, copper and semiconductors.

There are also central bank meetings, including by the Federal Reserve, which concludes Wednesday and is expected to see them keep rates steady. The European Central Bank is expected to cut rates by 25 bps on Thursday.

Oil prices recovered some of Monday losses, with benchmark Brent crude futures LCOc1 up 0.8% at around $77.69 a barrel and gold XAU=, which had slipped as investors liquidated bullion to cover losses, hovered around $2,742 an ounce.