ASX 200 Dips as DeepSeek Shakes Markets; Musk Adds Fuel to Fire

ASX 200 Dips as DeepSeek Shakes Markets; Musk Adds Fuel to Fire

ASX 200 Dips as DeepSeek Shakes Markets; Musk Adds Fuel to Fire

The ASX 200 saw a turbulent session today, closing marginally higher but with clear signs of investor jitters, particularly in the tech and real estate sectors. Concerns over Chinese startup DeepSeek’s advancements in artificial intelligence sent ripples through the market, pulling down several major players and sparking heated debates among industry giants.

DeepSeek’s emergence is causing a stir globally, as the company claims to have developed an AI model that rivals the performance of leading U.S.-made technologies at a fraction of the cost. Overnight, Wall Street took a significant hit, with the Nasdaq falling 3% and Nvidia shares plunging 16.7%. This sentiment spread to the Australian market, where tech stocks took a heavy blow. Companies like WiseTech and NextDC saw sharp declines, with the latter dropping 8.7%. Similarly, DigiCo REIT, a data center investment trust, plummeted by 10.5%, exacerbating concerns about the broader implications of DeepSeek's innovations.

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Elon Musk has also entered the fray, accusing DeepSeek of misleading the public about its capabilities and the volume of Nvidia chips it has supposedly acquired. Musk’s comments have added to the uncertainty, as investors grapple with the potential ramifications for U.S. chipmakers and export controls.

Beyond tech, the effects of this upheaval spilled into the real estate sector, with Goodman Group falling 6.7%. Even uranium miners, such as Paladin Energy and Boss Energy, weren’t spared, as fears grew that more efficient AI models could reduce future reliance on nuclear power. Both stocks nosedived by over 10%.

Interestingly, banks provided some relief to the market. Commonwealth Bank rose 1% after announcing the sale of its stake in Bank of Hangzhou, while Sigma Healthcare saw a 7.8% boost following record sales by its merger partner Chemist Warehouse.

As the dust settles, the debate around DeepSeek’s true impact continues. Whether the startup is poised to revolutionize AI or if the fears are overblown remains to be seen. One thing’s clear: the ASX, much like global markets, is closely watching this developing story.

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