Chinese Stocks Surge On AI Breakthrough
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Chinese equities experienced a significant rally on Thursday, with major indices reaching their highest levels in over a month.
The Shanghai Composite Index advanced 1.3% to close at 3,271, while the Shenzhen Component surged 2.26% to finish at 10,394.
The market’s upward momentum was primarily driven by robust performances in the artificial intelligence and robotics sectors.
This surge in enthusiasm can be largely attributed to recent breakthroughs by DeepSeek, a Chinese AI startup that has rapidly emerged as a formidable competitor to established Western AI giants.
DeepSeek’s latest AI model, R1, has demonstrated capabilities comparable to industry leaders while operating at a fraction of the cost, sparking widespread interest among investors and tech enthusiasts alike.
Adding to the positive sentiment was an easing of global trade war concerns.
Despite the Trump administration’s recent imposition of 10% tariffs on Chinese imports, Beijing’s response has been notably measured.
This restrained approach has helped alleviate some of the market’s anxiety surrounding potential economic fallout from escalating trade tensions.
The technology sector led the day’s gains, with several companies posting impressive performances.
360 Security Technology saw its shares climb 7.5%, while Zhejiang Sanhua and Naura Technology experienced even more substantial increases of 8.4% and 8.5%, respectively.
In the automotive technology space, BYD Company captured investors’ attention, with its stock price soaring 10%.
This surge followed reports that the company is poised to unveil its advanced intelligent driving system at an upcoming event.
BYD’s DiPilot platform, slated for release as early as November, is expected to feature the company’s proprietary algorithms and could potentially rival systems from industry leaders like Tesla.
The market’s robust performance reflects growing optimism about China’s technological advancements and its ability to compete on the global stage, particularly in cutting-edge fields like artificial intelligence and autonomous driving.
As Chinese companies continue to innovate and challenge established players, investors appear increasingly confident in the long-term prospects of the country’s tech sector.
Source: Trading Economics