By Medha Singh, Amanda Cooper and Harry Robertson LONDON/MILAN (Reuters) - Chip stocks in the U.S. and Europe rose on Wednesday for a second straight day, recovering from a punishing selloff triggered by China's low-cost DeepSeek artificial intelligence tool at the start of the week.

Nvidia shares' 9% recovery Tuesday was the second-best day in terms of market cap added for any company ever—but the company faced another selloff Wednesday.

Global chip stocks slumped Monday on DeepSeek revealing it had developed AI models that nearly matched American rivals despite using inferior chips.

U.S. chip stocks were a mixed bunch with several joining Nvidia in the red. Cirrus Logic was down 2.2% while ARM Holdings' U.S. shares fell 2.1% and Broadcom lost 1.8%. On the other side of the fence Coherent Corp was up 3.6% and Advanced Micro Devices rose 2.6%. ASML's U.S. shares were last up 4.4%.