China’s DeepSeek, a rising star in artificial intelligence (AI), has made waves in the tech sector with the launch of its R1 large language model. This rapid growth has triggered concerns about the cost of competing models for U.S. companies, sparking a sharp sell-off in AI stocks. While the market’s immediate reaction appears grim, analysts view this as a great opportunity for smart investors looking to capitalize on the downturn.
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In the wake of this sell-off, major players have felt the impact. Nvidia (NVDA), a key AI player, saw its stock tumble by 17% in yesterday’s trading. Similarly, Microsoft (MSFT), with its deep ties to OpenAI, slipped about 2%. Broadcom (AVGO) dropped 17%, Advanced Micro Devices (AMD) fell by 6%, and Alphabet (GOOGL) dipped by 4%. However, in an interesting turn, Meta Platforms (META) rose by about 2% amid the market chaos.
Wedbush Analysts See the Technology Selloff as a “Golden Buying Opportunity”
Despite initial market jitters, analysts believe the tech sell-off reflects short-term fears rather than a long-term concern. Wedbush experts call it a “golden buying opportunity,” dismissing fears over China’s DeepSeek. They argue that major U.S. companies are unlikely to rely on a Chinese startup for building their AI infrastructure.
Ives acknowledges DeepSeek’s recent success but points out that it lacks the scale and complexity to compete with industry giants. He emphasizes that companies like Nvidia remain vital to the global AI ecosystem.
Given this market scenario, analysts encourage investors to capitalize on the dip by considering top tech stocks such as Nvidia, Microsoft, Alphabet, Palantir (PLTR), Salesforce (CRM), and Amazon (AMZN).
What Is the Best AI Stock to Buy?
For investors looking to dive into the rapidly growing artificial intelligence sector, selecting the right stocks can be challenging. To simplify the process, we’ve compiled a list of AI stocks that analysts are bullish about using the TipRanks Stocks Comparison tool.
