Before Thursday’s market opening, the sharp decline in Marvell Technology stock and the latest advancements in China’s AI industry seemed to remind the US stock market of its initial encounter with DeepSeek.
As of press time:
- Dow Jones futures (2503 contracts) fell 1.09%
- S&P 500 futures dropped 1.38%
- Nasdaq 100 index futures declined 1.74%
China’s AI Innovation Shakes the Market
In this latest wave of AI innovation from China, Alibaba is the first to attract attention. According to the company, its new AI model has only 32 billion parameters yet delivers overall performance comparable to the R1 model with 671 billion parameters.
Also on Thursday, Tencent Hunyuan launched and open-sourced its graph-generated video model. Meanwhile, another Chinese team released an AI agent, Manus, claiming it has outperformed OpenAI’s DeepSeek in the GAIA benchmark test. However, whether Manus will have a similar impact on the US stock market as DeepSeek did earlier this year remains to be seen in the coming days.
Alexandre Hezez, Chief Investment Officer at Banque Richelieu, commented:
“It is evident that Alibaba is influencing the sentiment of the US stock market. The technology sector has been weak recently, and when combined with Marvell’s financial report, it creates a rather bitter cocktail for the market.”
Chip Stocks and Broadcom’s Upcoming Financial Report
It’s worth noting that Broadcom, a leader in US ASIC chip manufacturing, is set to release its financial report after the market closes on Thursday.
Due to market sentiment:
- Broadcom fell over 4% before market open
- Nvidia dropped more than 3%
Europe’s Interest Rate Decision & German Bond Market Impact
Just before the publication of this article, the European Central Bank released its latest interest rate decision, cutting rates by 25 basis points, as expected. However, the key question remains: What comes next?
Germany’s historic fiscal reform plan has already caused significant turmoil. On Wednesday, German government bonds experienced their biggest one-day plunge since 1990, affecting broader markets in Europe and Japan. As of Thursday, the yield on Germany’s 10-year government bonds continued rising, indicating ongoing selling pressure.
Mass Layoffs Surge Ahead of February Jobs Report
Ahead of Friday’s non-farm payroll report, Challenger layoffs data released on Thursday revealed that job cuts surged to 172,000, marking a 245% increase from January—the highest level since July 2020.
Key layoff trends:
- 62,000 government layoffs linked to Elon Musk’s “Government Efficiency Department,” impacting 17 agencies
- Growing concerns about the “Trump trade war” leading to increased corporate layoffs
This data reinforces investor uncertainty regarding the upcoming February jobs report and the broader economic outlook in the months ahead.
Other Market News
Marvell Technology Plummets After Financial Report
Marvell Technology shares plunged over 17% before market open on Thursday. The company’s latest earnings report, released Wednesday after market close, showed:
- Revenue met expectations
- Net profit turned positive
- However, a slowdown in AI chip sales led to a negative market reaction
Despite AI and optical module chip revenue growing 78.5% YoY, market sentiment remains pessimistic.
Tesla’s Sales Plummet in Australia
Following poor performance in Europe, Tesla’s Australian sales also collapsed.
- February sales: 1,592 vehicles (-72% YoY)
- Model 3 sales: 668 units (-81% YoY)
As a result, Tesla’s stock fell over 2% before market open. Financial services firm Baird warned that Tesla’s Q1 delivery forecast of 437,500 vehicles is at risk, revising their estimate down to 369,400.
Apple’s First Foldable iPhone Expected by 2026
According to well-known Apple analyst Ming-Chi Kuo, Apple’s first foldable iPhone is expected to launch in late 2026 or early 2027.
- Design: Book-style folding
- Expected price: $2,000+
Trump to Meet with Tech Executives Next Week
Former President Donald Trump is set to meet with major US tech executives next week, including representatives from:
- HP Inc.
- Intel
- IBM
- Qualcomm
HP has confirmed its attendance, stating:
“Our leadership team is focused on trade policy and US manufacturing.”
Alibaba’s AI Model Tops Hugging Face Rankings
Hugging Face, the world’s largest AI open-source community, updated its rankings, with Alibaba’s Tongyi Qianwen QwQ-32B model topping the list.
- Achieved major advancements in mathematics, coding, and general reasoning
- Comparable performance to DeepSeek-R1
- Optimized for deployment on consumer-grade GPUs, drastically cutting costs
Following this news and a strong performance in the Hong Kong stock market, Alibaba’s US stock rose nearly 2% pre-market on Thursday, building on an 8.61% surge on Wednesday.
JD.com Reports Double-Digit Revenue Growth in Q4 2024
Chinese e-commerce giant JD.com reported strong financial results before the market opened on Thursday:
- 2024 annual revenue: ¥1,158.8 billion
- Q4 revenue: ¥347 billion (+13.4% YoY)
- Goods revenue growth: 14.0% YoY
- Services revenue growth: 10.8% YoY
As a result, JD.com’s stock surged nearly 5% in pre-market trading.
