Stock market hemorrhages $1TRILLION as Nasdaq drops 3% on fears China is winning AI arms race

Wall Street indexes sank 3 percent on Monday morning after a Chinese artificial intelligence startup triggered fears America's top tech stocks are overvalued. 

Investors dumped around $1 trillion of technology stocks in premarket trading sending the S&P 500 1.7 percent lower as markets opened at 9:30am. 
The tech-heavy Nasdaq has been hit harder, tumbling more than 3 percent on Monday morning. 

The panic has been driven by Chinese artificial intelligence startup DeepSeek which demonstrated a chatbot that it says rivals the top versions from OpenAI and Google but for a fraction of the cost. 
Chipmaker Nvidia, which has benefitted from the AI frenzy over the last eighteen months, fell around 11 percent as markets opened wiping out $465 billion in market value.