This week, DeepSeek R1 shocked the global market, triggering a significant decline in global tech stocks. As of the time of publication, U.S. stock futures plummeted, with Nasdaq 100 index futures down nearly 5%, S&P 500 index futures down nearly 3%, and Dow futures down nearly 1%. Broadcom fell over 11%, ASML dropped nearly 11%, Advanced Micro Devices fell over 10%, TSMC dropped nearly 10%, and Micron Technology fell nearly 9%. NVIDIA fell more than 13%. If this decline holds until the close, it will become one of the largest single-day evaporations of market value for a single company in history. Some analysts believe that the success of R1 may weaken market expectations for demand for NVIDIA's AI chips. European tech stocks also did not escape the downturn. Chip equipment manufacturer ASML led the decline, with its stock price dropping by as much as 12%. If these losses persist until the close, the total market value of the Nasdaq 100 index and the European Stoxx 600 technology sub-index could evaporate by as much as $1.2 trillion. The DeepSeek team completed the training of the new model with only about $6 million and approximately 2,000 NVIDIA dedicated chips, both the funding and chip usage scale are far below that of the world's leading AI companies. This raises questions about the high valuations of American tech giants represented by NVIDIA. DeepSeek R1 Shocks the Market: Are the Valuations of American Tech Giants Sustainable? DeepSeek R1 is considered capable of competing with the latest products from OpenAI and Meta Platforms. Notable investor Marc Andreessen praised it as "one of the most stunning and impressive breakthroughs." DeepSeek's application can demonstrate its working process and reasoning logic when answering user queries, a transparency feature that has received widespread acclaim from users. The product quickly topped the Apple App Store charts after its release last week. Vey-Sern Ling, Managing Director of Union Bancaire Privee, stated: "DeepSeek shows that it is possible to develop powerful AI models at a lower cost. This could disrupt the investment case for the entire AI supply chain, which is currently driven by the high spending of a few mega-scale companies." This development has also raised concerns about the high valuations of American tech companies. The current expected price-to-earnings ratio of the Nasdaq 100 index is 27 times, higher than the average of 24 times over the past three years. NVIDIA's price-to-earnings ratio is 33 times, slightly below its three-year average At the same time, Chinese AI-related stocks reacted positively. Companies like Merit Interactive, which have a clear connection to DeepSeek, saw their stock prices hit the daily limit. The Hang Seng Tech Index rose 2% during the session. Charu Chanana, Chief Investment Strategist at Saxo Markets, pointed out that while the current leaders like NVIDIA have a solid position, this reminds us that dominance in the AI field is not unassailable: "The rise of China's DeepSeek indicates that competition is intensifying, and future competitors will evolve faster and challenge established companies."