DeepSeek Fever Fuels Patriotic Bets On Chinese AI Stocks

DeepSeek's low-priced design boosts wish for visualchemy.gallery China AI transformation


DeepSeek stirs nationalistic fever in the middle of Sino-U.S. rivalry


AI-related stocks in China and Hong Kong surge


By Samuel Shen and Jiaxing Li


SHANGHAI/HONGKONG, Feb 6 (Reuters) - Chinese financiers are rushing into AI-related stocks, betting the expert system advance of home-grown startup DeepSeek will cause a boom in the sector wiki.snooze-hotelsoftware.de and give the initiative to China in an intensifying Sino-U.S. technology war.


Feverish purchasing has actually pumped up shares of Chinese chipmakers, software application designers and sincansaglik.com information centre operators amidst patriotic require an upward repricing of Chinese assets as U.S. President Donald Trump charges a trade war with fresh tariffs.


"DeepSeek's development shows Chinese engineers are creative and efficient in innovations that can contend with Silicon Valley," said China Europe Capital Chairman Abraham Zhang. "It has also stirred nationalistic fever in capital markets."


DeepSeek shocked Silicon Valley and rocked Wall Street late last month with the announcement of a competitive big language design that was seemingly less to develop than those of big-spending U.S. leaders such as OpenAI and Meta.


The event was explained as a watershed moment by Huaxi Securities analysts and has considering that seen cash gushing into AI-related stocks in mainland China and Hong Kong.


The Hang Seng AI Index has jumped more than 5% this week while indices tracking chipmakers and sitiosecuador.com IT firms rose more than 11%, helping steady the Hong Kong market as the U.S. added a 10% tariff to Chinese imports.


On the mainland, financiers returning from a week-long Lunar New Year vacation on Wednesday likewise piled into the tech sector, enhancing shares of companies in AI, semiconductors, setiathome.berkeley.edu huge information and robotics.


"2025 will witness an explosion of AI applications," said Zhou Yingbo, head of investment at Futures Vessel Capital.


"We're extremely optimistic about chances developed by this revolution," Zhou said, expecting widespread adoption of both AI hardware and software by customers and organizations alike.


Likely recipients include Nancal Technology, Suzhou MedicalSystem Technology, Doctorglasses Chain, Bestechnic Shanghai and Ucap Cloud Details Technology, Huaxi Securities said.


The DeepSeek development shows how the U.S. attempt to slow China's technological development "has backfired, instead accelerating Chinese AI development," TF Securities said in a client note. It required a repricing of Chinese innovation stocks which have underperformed U.S. peers in recent years amid increased regulative examination and geopolitical tension.


The introduction of DeepSeek could prompt even tighter U.S. technology export constraints however that will only welcome more government support and turbo-charge development, the brokerage said.


Goldman Sachs anticipates Chinese developments in AI advancement and application "might materially change" the stock exchange trajectory.


The Wall Street bank approximates AI-enabled performance enhancement could increase incomes by 2% for Chinese equities, while brighter development prospects could result in a 20% appraisal uplift for Chinese firms, narrowing the gap with U.S. peers.


China's "difficult tech" stocks trade at a cost representing 23.6 times incomes, while "soft tech" shares trade at 13.9. The price-to-earnings ratio of the greatest U.S. tech stocks, the so-called "Mag 7", wiki.dulovic.tech is 31, showed the Goldman report dated Feb 4.


DeepSeek has developed such a buzz that Chinese companies up and down the AI worth chain, from chipmakers to cloud provider are exploring possibilities with the start-up's affordable services, including heavyweights such as Huawei Technologies, Alibaba and higgledy-piggledy.xyz Baidu.


Yi Xiangjun, partner of Shenzhen Black Stone Asset Management, said he is "all in" China's AI and tech stocks, betting large, successful companies will emerge in what he called an epoch-making transformation.


However, Wang Zhuo, partner of Shanghai Zhuozhu Investment Management, was more careful.


"Many companies are still far method from producing make money from AI ... As a worth financier, I don't feel positive putting cash into these stocks." (Reporting by Samuel Shen and Jiaxing Li; Editing by Vidya Ranganathan and Christopher Cushing)