U.S. stocks fell in overnight trading amid concerns over AI progress from China's DeepSeek. Huge earnings and the latest Federal Reserve meeting on tap.

Nasdaq futures tumbled 537.25 points, or 2.45%; Dow futures sank 356 points, or 0.8%; S&P 500 futures slid 85.75 points, or 1.4%.

AI infrastructure stocks got a boost last week from the big Stargate project announced by President Trump, led by Oracle, SoftBank and OpenAI. But, despite Meta's big capital spending plans, many AI hardware stocks fell in overnight trading. Why? Chinese AI lab DeepSeek released a powerful AI model that it claims cost just $6 million to build, using less-powerful chips. If true — or partially true — that could undermine demand for super-pricey AI chips and other gear.

Big Tech stocks dropped in overnight trading. Nvidia fell 7%; Tesla, Meta, Alphabet, Amazon and Microsoft fell around 3%; Apple fell 1.6%.

Except for Nvidia, other chip stocks also fell in overnight trading. SOXL fell 11.5%; TSMC, Arm, Broadcom, Marvell fell 6%.

Further, DeepSeek reportedly spent only $5.6 million over two months to develop its latest AI model, which outperformed systems from OpenAI and Meta, noted economist Ed Yardeni in a report.

DeepSeek's success could weigh on U.S. earnings reports, Yardeni said, amid enormous capital spending increases.

"This might be bad news for the Magnificent 7 that had plans to dominate the AI market with their expensive AI services," Yardeni added. "The question is whether they will disappoint because their capital spending on AI is soaring faster than are their revenues. That could squeeze their collective profit margin." He says chipmaker Nvidia also could be impacted.