LIVE MARKETS-The patient is in stable condition
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THE PATIENT IS IN STABLE CONDITION
U.S. stocks have stabilized in the wake of the artificial intelligence induced fears of the prior session that rippled through a host of sectors and sent chipmaker heavyweight Nvidia NVDA.O to a 17% decline.
The emergence of a low-cost Chinese AI model from startup DeepSeek wiped out almost $600 billion in market cap from Nvidia and pushed the Nasdaq Composite .IXIC to a drop of more than 3%, its largest daily percentage drop since Dec. 18. The PHLX semiconductor index .SOX plummeted 9.2%, its largest decline since March 2020.
But the Nasdaq is bouncing somewhat on Tuesday, while the S&P 500 .SPX and Dow Industrials .DJI show modest gains as investors weigh the impact from the latest development in what has been a major market driver in recent years, pushing the S&P 500 to back-to-back years with over 20% gains.
In a note late Monday, Keith Lerner, co-chief investment officer at Truist Advisory Services in Atlanta, said yesterday's selloff led to a rotation into software stocks as "they potentially benefit from cheaper access to AI tools, making it more economical to incorporate into use cases."
Among the 11 S&P 500 sectors, only three are on the plus side early on Tuesday, however, with tech .SPLRCT, up around 2%, the leading advancer. Utilities .SPLRCU are the weakest group, down around 1.2%.
Below is you early market snapshot:
(Chuck Mikolajczak)
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FOR TUESDAY'S EARLIER LIVE MARKETS POSTS:
OUT OF THE GATE, DIVIDENDS PROVING NOBLE - CLICK HERE
THE YEAR OF THE SNAKE - CLICK HERE
CAPITAL GOODS: INVESTORS ON ALERT OVER CHINESE COMPETITION - CLICK HERE
THREE CATALYSTS TO SUPPORT EUROPE'S RE-RATING - CLICK HERE
STOXX 600 RISES AS INVESTORS EVALUATE DEEPSEEK IMPACT - CLICK HERE
EUROPE BEFORE THE BELL: FUTURES MOSTLY HIGHER AFTER DEEPSEEK WOBBLE - CLICK HERE
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