DeepSeek has created significant buzz in the markets, particularly affecting Nvidia and raising investor concerns. January has experienced notable volatility, influenced by various factors that have shaped investor sentiment.

Initially, increasing bond yields put pressure on stocks, but this was followed by a surge of optimism linked to Donald Trump’s return to the White House. However, influential figures are warning that stock valuations might be too high, which adds to the uncertainty in the market.

As the markets look ahead to February, there is a call for the Federal Reserve to implement a less restrictive policy after a series of rate hikes. The upcoming Fed meeting will be pivotal in determining if this message is acknowledged. Additionally, there is a focus on concentration risk within the market, highlighting the dominance of:

• Nvidia
• Meta
• Amazon
• Microsoft

With these technology leaders increasing their investments in AI projects, concerns are being raised about the sustainability of their valuations during the current earnings season.

📎 Related coverage from: yahoo.com