(Bloomberg) -- Japanese stock futures slid, with chip-related shares poised to extend Monday’s declines after concern over Chinese artificial-intelligence startup DeepSeek set off a selling spree in US tech shares.

Nikkei 225 futures were at 39,060.00 on the Chicago Mercantile Exchange, compared with the close of 39,565.80 for the underlying gauge. A stronger yen may also weigh on exporters after rising as much as 1.5% against the dollar as traders sought safety in haven currencies amid the tech selloff.

“The overall market will likely start weaker, led by futures, as investors price in DeepSeek and the yen appreciation,” said Ryuta Otsuka, a strategist at Toyo Securities Co. “After the initial reaction, the market may rebound” as we’re entering the earnings season, he said.

The low-cost AI model offered by DeepSeek that rivals those of US companies raised concerns whether high valuations of firms including Nvidia Corp. can be justified. Nvidia shares erased $589 billion from its market capitalization — the largest in history, while a closely watched gauge of chipmakers tumbled more than 9%.

In Tokyo, chip-related shares including Nvidia tester supplier Advantest sank on Monday as DeepSeek gained traction during Asian trading hours. But the plunge in US tech shares may spur fresh selling.