This week in the U.S. market, tech stocks tumbled as China’s DeepSeek AI model emerged as a major competitor, training at a fraction of the cost of U.S. rivals. Nvidia, which has dominated AI chip production, saw a staggering 17% drop. Markets also reacted to the Federal Reserve’s decision to pause its recent stretch of interest rate cuts, signaling that further reductions may not be imminent. Additionally, former President Trump reignited trade war concerns by reiterating a 25% tariff on imports from both Canada and Mexico. Meanwhile, Bitcoin dipped below $100,000, marking its lowest level in 11 days before bouncing back slightly above $99,000. Analysts linked the drop to investor caution following the Chinese AI surge, which triggered a selloff in Western AI-related stocks. Despite this, Trump Media saw a 6.76% gain after its parent company announced an expansion into financial services, including potential crypto investments.

Economic news painted a grim picture for Germany, as its GDP declined by 0.2% in the final quarter of the year, marking a second consecutive annual contraction for Europe’s largest economy. On the political front, the U.S. froze nearly all foreign aid, making exceptions only for emergency food assistance and military funding for Israel, Egypt, and Turkey. Additionally, Trump retaliated against Colombia for rejecting U.S. deportation flights, imposing an initial 25% tariff on Colombian imports, which will increase to 50% within a week. Further measures include a travel ban, immediate visa revocations for Colombian officials, and financial sanctions under the International Emergency Economic Powers Act (IEEPA). In South Korea, former President Yoon Suk Yeol was indicted on charges of leading an insurrection after his short-lived martial law declaration in December, which sought to control media and ban political activity.

Corporate developments included Nvidia’s worst trading day since March 2020, with shares plummeting 16.97% to $118.42 following weaker-than-expected revenue of $9.4 billion. UPS also suffered its worst session ever, with shares plunging 14.11% after announcing a revised agreement with Amazon that will reduce shipping volume by over 50% in the second half of 2026. Toyota remained the world’s top-selling automaker for the fifth consecutive year, selling 10.8 million vehicles in 2024, while Volkswagen reported a 2.3% decline in sales, falling to just over 9 million units. In technology news, Chinese startup DeepSeek surged to become the top-rated free app on Apple’s U.S. App Store, with its AI model surpassing Stability AI and OpenAI’s models in image generation benchmarks.

In a fascinating scientific revelation, researchers at Utrecht University discovered two colossal “islands” hidden deep within Earth’s mantle, each the size of a continent. These regions, estimated to be at least 500 million years old, are significantly hotter than their surroundings and challenge long-standing theories about mantle convection. Rather than a rapidly flowing and well-mixed interior, this discovery suggests that Earth’s mantle has less movement than previously thought, reshaping our understanding of the planet’s inner dynamics.

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