Government policies, generous funding and a pipeline of AI graduates have helped Chinese firms create advanced LLMs.

The Chinese artificial intelligence firm DeepSeek has rattled markets with claims its latest AI model performs on a par with those of OpenAI, despite using less advanced, more energy efficient compute

OpenAI believes DeepSeek used a process called “distillation,” which helps make smaller AI models perform better by learning from larger ones.

Nvidia shares' 9% recovery Tuesday was the second-best day in terms of market cap added for any company ever—but the company faced another selloff Wednesday.

Nvidia staged a moderate rebound on Tuesday, rising as much as 3%, following a 17% drop the prior day. More broadly, major US indexes rallied after the S&P 500 and Nasdaq 100 saw sharp losses on Monday amid concerns over the Chinese AI firm DeepSeek's rapid and seemingly cost-effective advances.