The stock market changes priorities

US indices opened the week with a sharp collapse. The news media unanimously attributed this decline to the strong results of DeepSeek, a Chinese competitor of OpenAI’s ChatGPT. The news that a strong network can be trained on obsolete Nvidia chips at ten times lower cost pulled sales of the entire sector, led by Nvidia. Last year’s AI leader is struggling to regain momentum.

The markets overall are now gently recovering. The Nasdaq100 recovered 90% of its opening loss to the low point, managing to quickly bounce back into the area above the 50-day moving average. This is an important signal of the continuation of the trend from September.

The S&P500 closed Monday’s gap up and is trading above 6100, just 0.5% above the all-time highs. The latest dip may have worked as bait for those waiting for lower prices to join the rally in stocks. Recent data shows that once again retail investors are active in the market.

The Dow Jones surpassed the 45,000 mark, entering the area of all-time highs. The steady rise in this index has been almost uninterrupted since January 13, indicating a shift in stock market favourites from the Big Techs to the more classic large corporations and banks.