By Andrea Shalal and David Shepardson

WASHINGTON, Jan 28 (Reuters) - U.S. officials are

looking at the national security implications of the Chinese

artificial intelligence app DeepSeek, White House press

secretary Karoline Leavitt said on Tuesday.

The National Security Council is reviewing the app's

implications, she said. "This is a wake-up call to the American

AI industry," Leavitt said, adding the White House was working

to "ensure American AI dominance".

Investors sold technology stocks across the globe on Monday

over concerns the emergence of a low-cost Chinese AI model would

threaten market dominance of U.S.-based AI leaders such as

OpenAI and Alphabet's Google.

Leavitt did not indicate what the review would entail and

whether the White House would take any action after its review.

During his administration, former President Joe Biden placed

a wide range of export restrictions on AI chips and the

equipment used to make them, hoping to hamper AI development in

China.

President Donald Trump said on Monday the Chinese app should

act as a spur for American companies and said it was good that

companies in China have come up with a cheaper, faster method of

artificial intelligence.

"The release of DeepSeek AI from a Chinese company should be

a wake-up call for our industries that we need to be

laser-focused on competing to win," Trump said.

Trump said Chinese leaders had told him the U.S. had the

world's most brilliant scientists, and he indicated that if

Chinese industry could come up with cheaper AI technology, U.S.

companies would follow.

"We always have the ideas. We're always first. So I would

say that's a positive that could be very much a positive

development. So instead of spending billions and billions,

you'll spend less, and you'll come up with, hopefully, the same

solution," Trump said.

Efforts to stop the flow of AI chips to China from U.S.

companies such as Nvidia ( NVDA ) and Advanced Micro Devices ( AMD )

, were spearheaded by the Commerce Department. Trump's

choice to lead that agency, Wall Street banker Howard Lutnick,

is scheduled to appear in his nomination hearing on Wednesday.