Summarize this content to 2000 words in 6 paragraphs in Arabic The artificial intelligence-powered rally in US stocks has further to run, say equity investors, although the “wake-up call” from Chinese start-up DeepSeek is likely to reorder the winners and losers from the rapidly evolving technology.DeepSeek last week unveiled a cutting-edge reasoning model capable of competing with those designed in the US — but apparently for a fraction of the cost — sending shockwaves through equities markets and reigniting fears among some investors of a repeat of the dotcom crash at the start of this century.By the end of Monday, chipmaker and stock market darling Nvidia had shed almost $600bn — the biggest one-day loss in US history. A ferocious US tech sell-off spread to energy stocks and utilities that had been expected to benefit from demand for power to fuel AI data centres. But since then, the sell-off has run out of steam. US indices ended the week lower, with Nvidia close to its Monday lows. The S&P 500 and tech-heavy Nasdaq Composite lost 1 per cent and 1.6 per cent over the past five sessions.“DeepSeek isn’t devastating for the overall market. The impact will be far more subtle,” said Alicia Levine, head of investment strategy and equities at BNY Wealth.She expects healthcare stocks and other companies with access to massive amounts of data to reap the rewards as investors move into less richly priced areas of the market. “If AI becomes cheaper and faster, it makes sense that those companies would see a boost in value,” Levine said. “The picks and shovels” companies in the energy and infrastructure sectors, which have been among the main beneficiaries of Big Tech’s huge capital expenditure on AI, may suffer most, she added.Megacap tech stocks, and excitement around the potential of AI, have been the main driver of the US stock market’s strong performance in recent years. Last year the so-called Magnificent Seven tech stocks were responsible for more than half of the S&P 500’s gain.However, bears fear that DeepSeek’s breakthrough could have huge implications for the spending plans and valuations of some of the Silicon Valley giants that have driven that rally, and for the wider, top-heavy US market, where the largest 10 stocks now account for almost two-fifths of the S&P 500.DeepSeek “tells us there is growing competition and AI may be harder to monetise than assumed”, said Robert Almeida, global investment strategist at MFS Investment Management.He thinks the Chinese firm represents the start of a new capital cycle, creating “growing supply, growing competition, and lower returns” that may threaten the high valuations of the big AI incumbents.Billionaire investor Ray Dalio told the Financial Times this week that AI hype had fuelled a “bubble” in US equities. Beyond Nvidia, big losers this week have been chipmaker Broadcom and energy groups GE Vernova and Constellation Energy.But many investors and analysts think the sell-off was a blip rather than the start of a fundamental market shift. “I don’t think [we’re in] a bubble and I don’t think we are about to see a bubble burst,” said Peter Oppenheimer, Goldman Sachs’ chief global equity strategist. Instead, DeepSeek was simply a reminder that the “dominant tech companies are not immune from disruption and competition”.Investor appetite for US tech companies appeared undimmed on Thursday, when shares in Tesla and Meta rose after the two companies pledged to pour billions more dollars into building out their AI infrastructure. Some think DeepSeek’s cheap alternative to OpenAI’s popular ChatGPT app could in fact spur even higher AI spending in the US. Bank analysts’ notes last week talked of the so-called Jevons paradox — the theory that demand for technology such as AI will surge as it becomes cheaper and more energy efficient, leading to an overall increase in energy use.“Everybody is [too] negative. [DeepSeek] is not going to change the underlying demand for computing capacity,” said Christopher Rossbach, chief investment officer at Nvidia shareholder J Stern & Co, citing massive spending commitments made by groups such as Meta.He does not believe Nvidia is overvalued, and thinks that rising profits will support the stock price of some Big Tech firms. “You may not have an increase in the valuation but you will benefit from the growth in earnings, in revenues and in cash flows.”Venture capitalist Reid Hoffman, billionaire co-founder of LinkedIn and ManasAI, sees DeepSeek’s breakthrough as bullish for the wider AI sector. “DeepSeek isn’t a game-changer for global AI hegemony, but it is a welcome wake-up call that China’s competitive talent is very capable,” he told the FT. “Many small AI companies in the US use large models to train their smaller models more efficiently. So a quality model like DeepSeek trained using that tactic is a positive signal for what small AI companies in the US can build,” he added. Some even think this week’s market turmoil could spark a healthy rebalancing for the wider market.Marko Kolanovic, JPMorgan’s former chief global markets strategist — who has long warned of the risks to market stability from investors piling into the same handful of stocks and trades — said Nvidia’s 17 per cent decline on Monday should provide the market with a “shot in the arm”.The past week’s sell-off may trigger a rotation within the tech sector into relative “laggards” like Apple, he said. “Maybe [Nvidia] isn’t such a sure bet after all.”Additional reporting by Mari Novik and Harriet Agnew in London
