Financial experts in Hong Kong on Tuesday said low-cost Chinese artificial intelligence model DeepSeek may not necessarily cause a shift in the flow of global funds.
The release of the AI assistant led to a sell-off in Nvidia shares, which fell 17 percent on Monday, wiping nearly US$600 billion from the AI chip market leader’s market value – a record one-day loss for any company.
The startup behind DeepSeek said it uses less data at a fraction of the cost of services currently available, a comment that has garnered attention worldwide, and sparked speculation that global investors will look for cheaper AI options.
Andrew Sullivan, founder of Asian Market Sense, pointed out that intense competition is commonplace in the AI sector.
"I think what we have seen from DeepSeek is the fact that the Chinese have innovated using older chips and being able to use them by understanding the architecture better and linking them better together," Sullivan said.
"It's difficult to see how utilising old chips is really going to keep up with the modern advances that we're seeing in the current generation and the next reiteration of the Nvidia chips, so I think there's still going to be a lot of competition there," he told RTHK.
Almagest Asset Management chief executive James Wong said DeepSeek’s emergence is a good thing for the development of AI, but he did not think it would cause a significant change in terms of global capital flow.
"It doesn't come as a surprise for us that the cost of developing the model R1 is that much less than the cost that OpenAI is running," Wong said, using the name of DeepSeek’s open-source AI model.
Their remarks came as the city's Hang Seng Index rose for the third straight session in a row, increasing 0.1 percent to close at 20,225, partially boosted by the optimism generated by DeepSeek. (Additional reporting by Reuters)
'DeepSeek may not cause shift in flow of global funds'
2025-01-28 HKT 21:56
Share this story
