Following the release of an artificial intelligence model that the Chinese tech giant claims can rival DeepSeek, this year’s unexpected tech star, Alibaba shares jumped more than 7% in Hong Kong trade on Thursday.
Since January, when DeepSeek presented a cutting-edge chatbot that appeared to be at a fraction of the cost that Western industry executives believed was required, investors have been riding high on China’s AI capabilities.
Alibaba claims the QwQ-32B, their newest AI model, which was unveiled Thursday morning, has “comparable performance” to DeepSeek and uses a lot less data to operate.
Before Hong Kong’s Stock Exchange halted trading in the middle of the day, shares of the e-commerce giant surged more than 7%.
The enormous tech sector in China has benefited from weeks of increased market confidence.
After years out of the spotlight, Alibaba co-founder Jack Ma was spotted last month with Chinese President Xi Jinping at a conference for the nation’s top business leaders.
Just before Beijing halted Alibaba’s impending, massive initial public offering (IPO), the billionaire businessman had criticized government rules in late 2020.
A broader regulatory crackdown that followed wiped more than a trillion dollars off the value of China’s major tech firms.
But Ma’s inclusion in last month’s meeting hinted at his potential public rehabilitation following his tangle with regulators.
DeepSeek’s arrival on the scene this year has pleased authorities, who have intensified efforts to revitalise lacklustre activity in the world’s second-largest economy in recent months.
Alibaba’s QwQ-32B joins another recent entrant, Tencent’s Yuanbao, in an enhanced domestic rivalry with DeepSeek.
Beijing pledged on Wednesday to strengthen support for consumption, which has been weak in China since the Covid-19 outbreak, which might help the company.
Based in Hangzhou Alibaba, the company behind some of the most popular e-commerce sites in China, announced last month that it would invest over $50 billion on cloud computing and artificial intelligence over the following three years.
