Steven Cohen, the founder of Point72 Asset Management, shared an optimistic view on the implications of DeepSeek’s recent announcements at the iConnections conference in Miami on Tuesday. DeepSeek, a Chinese AI startup, sparked significant market turbulence by claiming its AI models rival or outperform U.S. industry leaders at a fraction of the cost. The announcement triggered a sharp selloff in tech stocks, with Nvidia bearing the brunt — plunging 17% on Monday and wiping out nearly $600 billion in market value, marking the largest single-day loss for a U.S. company in history. However, the megacap/$2.9 triilion tech giant rebounded nearly 9% on Tuesday, showing signs of recovery.
Cohen, however, sees these developments as fundamentally positive for the AI sector. He argued that DeepSeek’s advancements are “actually bullish because it advances the move to artificial intelligence.” This perspective challenges the immediate market reactions to perceive the competitive pressure as a catalyst for broader AI adoption and innovation rather than a threat.
Addressing the significant selloff in tech stocks, especially Nvidia, Cohen remarked, “Great companies are going to be expensive,” suggesting an acknowledgment of Nvidia’s high valuation but also an expectation of resilience and growth in the face of new competition. He implied that the market’s knee-jerk reaction might overlook the long-term benefits that such competition could bring to the AI landscape, including more efficient and cost-effective solutions.
Cohen also highlighted the dynamic nature of AI development, predicting that “new companies will use these tools,” and that the industry will continue to see significant advances. He suggested that the market’s moments of doubt, like the one experienced on Monday, are part of the cyclical nature of technological advancement, where skepticism often precedes major breakthroughs or shifts in market dynamics.
Earlier this month, Cohen revealed that Point72 had recently launched an AI-focused fund, which has already achieved a 14% gain in just three months, swelling to nearly $1.5 billion. This performance underlines his confidence in the AI sector’s growth potential. The success of this fund suggests not only that there is investor appetite for AI-related investments but also that Point72 is strategically positioning itself to capitalize on this trend, regardless of short-term market fluctuations caused by competitive announcements like those from DeepSeek.
Cohen’s commentary at the conference paints a picture of an AI industry that, while subject to market volatility, is fundamentally on an upward trajectory. His views encourage investors to look beyond immediate market reactions to the underlying technological advancements and the broader implications for industry growth, innovation, and the democratization of AI technology.
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