Zinger Key Points
- The emergence of DeepSeek could hurt valuations of artificial intelligence stocks.
- A Benzinga reader poll asks if investors should be concerned about the valuations of Magnificent 7 stocks.
- Get Wall Street's Hottest Chart Every Morning
A new Benzinga reader poll shows whether Monday's selloff of technology stocks could be short lived or a major item to watch with valuations of artificial intelligence companies questioned with the surge of interest in DeepSeek, a Chinese AI company.
What Happened: Monday's selloff hurt many technology stocks, with companies that deal with semiconductors and the AI sector among the highest impacted names.
Semiconductor leader NVIDIA Corporation NVDA lost around $600 billion Monday, dropping the company from the largest in the world to third largest and marking the largest single day value drop in U.S. stock history.
Here's a look at how the Magnificent 7 stocks traded Monday:
- Nvidia: -16.86%
- Alphabet Inc GOOGL: -4.20%
- Tesla Inc TSLA: -2.32%
- Microsoft Corporation MSFT: -2.14%
- Amazon.com Inc AMZN: +0.30%
- Meta Platforms META: +1.91%
- Apple Inc AAPL: +3.25%
Overall, the Mag 7 stocks were mixed, with three trading up on the day and four trading down. The large drop for Nvidia hit the Roundhill Magnificent Seven ETF MAGS hard with the ETF down 3.09% Monday.
The SPDR S&P 500 ETF Trust SPY, which tracks the S&P 500, ended Monday down 1.5%.
Benzinga asked readers how serious the threat from China's DeepSeek could be.
"Will China's DeepSeek AI drive down the valuation of Magnificent 7 stocks this year?" Benzinga asked.
The results were:
- Yes, it could pressure valuation: 57%
- No, the impact will be minimal: 44%
The poll showed a small majority believing that valuations of Magnificent 7 stocks are now under pressure.
Read Also: Jensen Huang Loses $20B In Wealth: How DeepSeek Hit Nvidia Stock And World’s Richest People
What's Next: On Tuesday, Magnificent 7 stocks that were down Monday recovered, with the market trading higher and rebounding from the losses.
Here are how the Magnificent 7 stocks traded on Tuesday:
- Nvidia: +8.82%
- Apple: +3.65%
- Meta Platforms: +2.19%
- Microsoft: +2.87%
- Amazon: +1.16%
- Alphabet: +1.70%
- Tesla: +0.24%
The S&P 500 ETF was up 0.86%, and the Magnificent Seven ETF was up 3.0% on Tuesday.
Of the Magnificent Seven stocks, five are positive year-to-date with Nvidia down 8.7% and Apple down 2.0% this year.
Six of the seven Magnificent 7 stocks have outperformed the +23% gain of the SPY over the last year, with Microsoft at +8.8% as the lone exception.
Monday’s selloff could either fade quickly or mark the beginning of significant concerns over valuations. Quarterly earnings results from four of the seven stocks reporting later this week may further intensify the focus on valuations.
Tesla, Meta and Microsoft all report after market close Wednesday, while Apple reports after market close Thursday.
The threat of DeepSeek and other emerging AI technology from China and outside the United States is a development that should be closely watched by investors moving forward.
Read Next:
The study was conducted by Benzinga from Jan. 27, 2025 through Jan. 28, 2025. It included the responses of a diverse population of adults 18 or older. Opting into the survey was completely voluntary, with no incentives offered to potential respondents. The study reflects results from 154 adults.
Photo gguy via Shutterstock.
© 2025 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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