The celebration of the Lunar New Year brought with it a wave of excitement in the world of artificial intelligence, particularly highlighted by the remarkable surge of a domestic AI company’s new model, DeepSeekThis deep learning system has not only made a significant impact on the tech landscape but has also sparked major ripples in the capital markets, drawing investor attention and enthusiasm reminiscent of a high-stakes poker game.

On February 7, a particularly notable event occurred when Tuya Smart (stock code: 02391.HK) unveiled its integration of DeepSeek capabilities into its cloud developer platformThe news sent Tuya’s stock price soaring, peaking at an astonishing increase of over 220%, reaching a record high of HKD 69.5 per shareBy the close, the stock had stabilized but still ended the day with a notable increase of 43.13%. The rise in Tuya’s stock mirrored a broader trend as several other companies in the Hong Kong market, including Xuanwu Cloud (02392.HK), Kingdee International (00268.HK), and Mingyuan Cloud (00909.HK), also witnessed their share prices rallying by over 10% as investors flocked to capture the potential gains associated with DeepSeek.

Tuya Smart has made its mark by focusing on advancing smart hardware technology and nurturing a thriving ecosystem around it

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Currently, their cloud development platform boasts an impressive community of over 1.26 million developers and supports more than 2,800 varieties of intelligent productsThis has created a complete supply chain that encompasses manufacturers, distributors, and agentsWith the introduction of DeepSeek, Tuya has enabled developers using its T3/T5 modular and AI Agent development platform to rapidly create and integrate AI hardware solutions and applications, realizing improved efficiencies and functionalities.

The effects of this integration were palpable, as evidenced on February 7, when Tuya's stock price displayed noteworthy volatilityAfter a strong morning trading session, shares skyrocketed by 229.38% to hit the unprecedented HKD 69.5 per shareAlthough the final trading day ended with a slight contraction, the stock still finished significantly higher, influxing confidence into the overall market.

The frenzy surrounding DeepSeek did not stop with Tuya Smart; companies like Xuanwu Cloud and Kingdee International also showcased significant improvements attributed to their own adaptations of DeepSeek technology

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For instance, Xuanwu Cloud’s stock saw an intra-day rise of surpassing 40%, ultimately closing 28% higherRecently, Xuanwu had announced the full integration of its industry-specific large model Smart Xiao Xuan with DeepSeek, significantly bolstering its capabilities in areas such as customer engagement, analysis, business opportunity identification, and innovative sales processesThis functionality is expected to greatly enhance the operational data intelligence available to enterprise clients.

On the other hand, Kingdee International reported a gain of 14.84% on February 7, culminating its stock price at HKD 12.38. The implementation of DeepSeek across Kingdee’s full suite of SaaS applications has promised a sophisticated enhancement in operational metrics, providing clients with high-efficiency and cost-effective intelligent solutionsKingdee is enthusiastic about deepening AI adoption across Chinese enterprises, leveraging DeepSeek's substantial reasoning and general intelligent capabilities.

Additional players, such as Weimob Group, reported consecutive percentage gains exceeding 10% across two days, attributing its success to the integration of DeepSeek into their self-developed large model application, Weimob WAI

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This development enables WAI to harness superior reasoning and scheduling abilities, only adding to the competitive edge in the various customer scenarios the company supports through its product line.

The market's enthusiasm for AI concepts, particularly those tied to DeepSeek, is not limited to day trading spikesNumerous investment banks and brokerages are adopting optimistic outlooks on AI-related stocksThey speculate that the current boom in DeepSeek-related stocks may usher in a wave of additional funding into the Hong Kong market, particularly targeting those companies entwined with the AI supply chainLooking further ahead, there is a consensus that DeepSeek could crucially influence the mainstream adoption of AI technology across multiple sectors, fostering further advancements and commercialization of AI-based solutions.

According to analysts from Xingzheng International, the rise of DeepSeek has reignited interest in the tech sector of the Hong Kong stock market

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The historically low valuations attributed to this sector have begun to recover, drawing investors into exploring the broader AI landscapeCapital is beginning to disperse among various sub-sectors within AI, such as autonomous driving and dedicated AI applicationsIn the realm of self-driving technologies, the precision and safety of algorithms could be significantly bolstered by DeepSeek's analytic power, propelling this technology toward wider commercial viabilityIn terms of AI applications, the emergence of innovative solutions will likely persist, meeting a swelling demand within the diversified market.

The enthusiasm surrounding AI has cultivated an optimistic investment environment, resulting in a concurrent rise in the three major indices within the Hong Kong stock market to three-month highs, setting the stage for challenges at two-year peaksThis trend encapsulates the market’s anticipation for substantial growth potential within the AI sector, further opening up opportunities for strategic investments and stakeholder involvement.