Nasdaq posted its biggest one-day percentage drop since Dec. 18 on Monday as a low-cost Chinese artificial intelligence model prompted a steep selloff in U.S. chipmakers.

The Nasdaq & S&P 500 fell after Chinese startup DeepSeek shows AI can be built cheaply, sparking fears AI spending will stall. The blue-chip Dow rose.

DeepSeek’s emergence has raised concerns that China may have overtaken the US in the artificial intelligence race despite restrictions on its access to the most advanced chips.