Monday's DeepSeek sell-off may have rattled investors who picked up shares of a top semiconductor play at any time over the past few weeks. Undoubtedly, it's not hard to imagine many new retail investors panicking in the face of Nvidia (NASDAQ:NVDA) stock's sudden double-digit percentage decline.

According to a paper authored by the lab, the DeepSeek-R1 model outperforms cutting-edge models such as OpenAI’s o1 and Meta’s Llama AI models across multiple benchmarks.

Technology shares steadied, led by a modest recovery in Nvidia after its record-breaking wipeout in market value.

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.

Japanese technology shares fell on Tuesday as a global market rout sparked by the emergence of a low-cost Chinese artificial intelligence model entered day two, with investors questioning the sky-high valuation and dominance of AI bellwethers.

Nvidia's stock was showing signs of recovery on Tuesday after a significant selloff triggered by DeepSeek's AI model launch.