Data Center Stocks Are Plunging -- Here's Why

The stock market was having a rough day on Monday, with the S 500 (SNPINDEX: ^GSPC) benchmark index down by about 1.7% at 11 a.m. ET. However, real estate was one of the biggest exceptions, with the Vanguard Real Estate ETF (NYSEMKT: VNQ) slightly higher for the day. In simple terms, Treasury yields are under pressure, which is generally a positive catalyst for real estate stocks.

However, not all real estate stocks were performing well. Data center giants Equinix (NASDAQ: EQIX) and Digital Realty Trust (NYSE: DLR) were lower by 7% and 12%, respectively, and records storage real estate investment trust (REIT) Iron Mountain (NYSE: IRM) was down by more than 8%.

Before we go any further, let's just recap why the market is falling on Monday. The biggest headline is that China-based start-up DeepSeek launched a large language model (LLM) in December that was developed in (as claimed by the company) two months at a cost of under $6 million. The same company just released a reasoning model that is outperforming OpenAI's equivalent in certain third-party tests.

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Source Fool.com