Nvidia shares' 9% recovery Tuesday was the second-best day in terms of market cap added for any company ever, trailing only a record it set in July.

Chip stocks in the U.S. and Europe rose on Wednesday for a second straight day, recovering from a punishing selloff triggered by China's low-cost DeepSeek artificial intelligence tool at the start of the week.

While companies like DeepSeek may find success in certain market segments, they face an uphill battle against this massive capital advantage. In other words, claims that demand for Nvidia's premium chips will collapse simply don't align with market realities and the trajectory of AI development.

Nvidia’s massive plunge Monday led to big one-day gains for investors betting against the stock. But shorting Nvidia has still been a losing bet.

Nvidia stock tumbled after DeepSeek's AI news surfaced in tech circles. Read more about the impact the DeepSeek developments may have NVDA stock now.

Chinese startup DeepSeek has achieved what many (including experts) thought impossible: create a foundational, competitive AI model for just $5.6 million. By comparison, OpenAI’s unreleased GPT-5 (codenamed “Orion”) reportedly requires $500 million for six months of training.

In a matter of days, DeepSeek proved to be so popular as to climb to the top of Apple's App Store, surpassing OpenAI's ChatGPT as the most downloaded app. But for owners of Nvidia stock, and stock traders in general, DeepSeek is on track of becoming a black swan — an unexpected event with extreme consequences.

After a market-wide panic over AI start-up DeepSeek, CNBC’s Jim Cramer reflected on what the new player’s entrance into the arena means for Big Tech.