Nvidia rose on Tuesday, clawing back some losses one day after the emergence of a cheaper, open-source artificial intelligence model from China caused the shares to post the biggest market value loss in stock market history.

The recent AI advances by Chinese upstart DeepSeek could be the beginning of a potential nightmare scenario that Nvidia Corp. Chief Executive Jensen Huang has been worrying about since the chip maker’s meteoric rise.

US chip giant Nvidia suffered a record wipeout on Monday after Chinese startup DeepSeek upended the tech sector — and the rout cost its CEO Jensen Huang more than $20 billion in a single day. DeepSeek said it built its new AI model in just two months for less than $6 million – a fraction of the training costs of its US rivals – and without access to Nvidia’s powerful,

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Short sellers of artificial intelligence-related stocks raked in bumper profits after the smashing debut of low-cost AI models from China's DeepSeek spooked Wall Street, with bets against Nvidia yielding record profits totaling more than $6 billion.

After plunging 17% on Monday, Nvidia looks set to recover on Tuesday, with its stock up 5% in premarket trade.