DeepSeek's assault on US tech stocks sent bond yields to a three-week low as investors sought safe havens.

U.S. bonds rose as investors sought safety amid a broad sell-off in U.S. stocks, with the benchmark 10-year yield falling 10 basis points to 4.52%, the lowest since Jan. 2. European bonds followed, with the German 10-year yield falling 7 basis points to 2.50%. At the same time, the dollar strengthened against most Group of 10 currencies, with the yen and Swiss franc also attracting safe-haven flows. This trend was driven by the release of DeepSeek's low-cost AI model, which achieved comparable performance to OpenAI's o1 at a fraction of the cost, raising concerns about the return on investment in the high-valued tech giants' AI investments. Some analysts believe that DeepSeek's ability to achieve top-tier model performance with limited hardware resources reduces reliance on high-end GPUs and suggests a significant decrease in the demand for computational power for large AI models. As the market prepared for a volatile week, U.S. bonds and safe-haven currencies rose. The Federal Reserve was set to announce its interest rate decision on Wednesday, and several tech giants were scheduled to release their latest earnings reports. Additionally, the market faced uncertainty stemming from former President Trump. Investors were still digesting Trump's dispute with Colombia over the weekend, which quickly agreed to send illegal immigrants back to Colombia to avoid Trump's high tariffs. Mohit Kumar, chief economist and strategist at Jefferies Europe, said: "This event once again demonstrates that tariffs are a negotiating tool, but the market needs to factor in some premium for the volatility that comes with tariff announcements." #End of Polished Translation