empty
28.01.2025 01:24 PM
Stock Market: S&P 500 and NASDAQ Partially Recovered After a Sharp Decline

The U.S. stock market partially rebounded after a sharp decline triggered by the Chinese startup DeepSeek, which caused many investors to question whether the AI market might be in a bubble—especially considering the valuation of a single company, NVIDIA. Notably, NVIDIA lost $600 billion in market capitalization yesterday.

This image is no longer relevant

S&P 500 and NASDAQ ended the day down 2% to 3%, and today, futures for these indices are trading with minimal volatility, slightly in the red. This indicates continued uncertainty about how investors and traders will act moving forward, seemingly waiting for statements or decisions from Donald Trump's new administration.

As noted earlier, shares of the chip manufacturer fell nearly 17% as the performance of DeepSeek's language model raised questions about the volume of investments in artificial intelligence. With these developments, the high-profile name in artificial intelligence is heading for its worst day since March 2020.

Investor concerns are growing as competition in the AI space becomes increasingly fierce. The emergence of new players like DeepSeek, capable of showcasing high-performing language models, challenges the dominance of major companies. These changes are prompting a reevaluation of investment strategies and possibly even project plans. While AI investments have been at the peak of popularity for some time, yesterday's events question these established norms and create market uncertainty. For many tech companies, this is a warning sign: the AI landscape is shifting, and caution is the best defense.

NVIDIA was not the only semiconductor company whose shares plummeted due to DeepSeek's developments.

  • Broadcom dropped more than 17%.
  • Micron declined by over 11%.
  • Advanced Micro Devices (AMD) fell by more than 6%.

The VanEck Semiconductor ETF (SMH) slid nearly 10%.

This image is no longer relevant

Technical Outlook for S&P500

Demand for the S&P 500 remains strong. Buyers' main goal today will be to break through the nearest resistance level at $6024, which would help sustain the upward trend and pave the way for a move toward $6038. A secondary but equally important target for bulls will be holding $6047, which would strengthen buyers' positions.

If the index moves downward amid reduced risk appetite, buyers will need to step up around $6003. A breakout below this level could quickly push the instrument back to $5986 and potentially open the door to $5967.

Jakub Novak,
Analytical expert of InstaForex
© 2007-2025
Select timeframe
5
min
15
min
30
min
1
hour
4
hours
1
day
1
week
Earn on cryptocurrency rate changes with InstaForex
Download MetaTrader 4 and open your first trade
  • Grand Choice
    Contest by
    InstaForex
    InstaForex always strives to help you
    fulfill your biggest dreams.
    JOIN CONTEST

Recommended Stories

Bullish trend under threat? Why Fed decisions could cool markets?

The US stock market opened cautiously after the holidays as investors are assessing the Federal Reserve's next moves and awaiting key economic reports. Futures on major indices show a modest

Anna Zotova 10:57 2025-02-18 UTC+2

Stock Market on February 18th: S&P 500 and NASDAQ Continue Steady Growth

U.S. stock index futures continue to show confident growth, driven by optimism surrounding high-level talks between the U.S. and Russia. S&P 500 futures rose by 0.4%, while the tech-heavy NASDAQ

Jakub Novak 09:44 2025-02-18 UTC+2

The Market on the Verge of Overheating: What Could Trigger a Correction?

The U.S. stock market continues its upward movement; however, indices are approaching key levels that could lead to profit-taking. The week ended in uncertainty: the S&P 500 closed unchanged

Anna Zotova 09:13 2025-02-17 UTC+2

Stock Market on February 14th: S&P 500 and NASDAQ Resume Growth

Efforts to resolve the Ukraine conflict continue to drive demand for risk assets, also providing support to stock markets. The strong rally in European equities and a significant rise

Jakub Novak 12:43 2025-02-14 UTC+2

The US Market Is Stuck in a Sideways Trend. Where to Look for a Breakout and What Will Drive Growth?

The US stock market is attempting to recover after yesterday's losses, but investors remain cautious. Ongoing inflation data and the Federal Reserve's statements regarding a wait-and-see approach to interest rates

Anna Zotova 09:48 2025-02-13 UTC+2

Stock Market on February 12th: S&P 500 and NASDAQ Stall Ahead of Key Data

Futures on U.S. stock indices are trading within a narrow range as traders eagerly await the release of key U.S. inflation data, which will provide insights into the potential timeline

Jakub Novak 14:30 2025-02-12 UTC+2

Jerome Powell Fails to Impress Markets

The wave analysis of the 4-hour SPX chart remains ambiguous. On the daily chart, a global five-wave structure is evident, extending beyond even the smallest zoom scale of the trading

Chin Zhao 10:09 2025-02-12 UTC+2

Stock Market Outlook for February 11: S&P 500 and NASDAQ Decline After New Tariffs

Asian indices and U.S. stock futures declined, while gold surged to a new high, signaling investor caution after President Donald Trump announced new tariffs on steel and aluminum imports

Jakub Novak 11:29 2025-02-11 UTC+2

Market on Pause: What to Expect from NFP and Its Impact on the Market?

U.S. stock futures decline on Friday as investors brace for the key jobs report, which could influence the Fed's next rate moves. U.S. stock futures are retreating on Friday

Anna Zotova 11:33 2025-02-07 UTC+2

Stock Market on February 7: SP500 and NASDAQ get frozen in anticipation of data

Futures for European and US stocks declined due to uncertainty and the usual pause traders take ahead of key economic data releases. Investors remain cautious as they are waiting

Jakub Novak 09:57 2025-02-07 UTC+2
Can't speak right now?
Ask your question in the chat.
Widget callback
 

Dear visitor,

Your IP address shows that you are currently located in the USA. If you are a resident of the United States, you are prohibited from using the services of InstaFintech Group including online trading, online transfers, deposit/withdrawal of funds, etc.

If you think you are seeing this message by mistake and your location is not the US, kindly proceed to the website. Otherwise, you must leave the website in order to comply with government restrictions.

Why does your IP address show your location as the USA?

  • - you are using a VPN provided by a hosting company based in the United States;
  • - your IP does not have proper WHOIS records;
  • - an error occurred in the WHOIS geolocation database.

Please confirm whether you are a US resident or not by clicking the relevant button below. If you choose the wrong option, being a US resident, you will not be able to open an account with InstaForex anyway.

We are sorry for any inconvenience caused by this message.