India, July 19 -- The launch of Kimi K3, a new artificial intelligence model from Chinese startup Moonshot AI, triggered a sell-off in U.S. tech stocks last week, led by chipmakers. Investors fear that cheaper Chinese AI models could reduce demand for expensive computing power, which has underpinned the current market boom, as WSJ writes.

By the close of trading on Friday, July 17, shares of Nvidia, Micron Technology, and other chipmakers were under pressure, while the semiconductor sector index fell by about 10% over the week.

Kimi K3 has rattled the market

Moonshot AI, which is headquartered in Beijing, unveiled the Kimi K3 model and said it plans to make it fully open by the end of July.

According to the company, the model has 2.8 ...