Alibaba’s Hong Kong shares (HK:9988) soared 7.3% on Thursday, driving a surge in Chinese tech stocks after the e-commerce giant unveiled its open-source AI model, QwQ-32B. The stock hit HK$139.60, its highest level since late 2021, leading the Hang Seng index to a 1% gain.
QwQ-32B, released by Alibaba’s Qwen division, is designed to rival DeepSeek R1 in reasoning performance while requiring significantly less data. Initially introduced in November 2024, QwQ-32B gained traction following the rise of DeepSeek earlier this year. Early testing suggests Alibaba’s model matches or outperforms DeepSeek, reinforcing China’s AI capabilities against global competitors like OpenAI.
Alibaba’s rally also fueled gains across the Chinese tech sector. Tencent (HK:0700) and Baidu (HK:9888) climbed 5.5% and 3.8%, respectively, while JD.com (HK:9618) rose 3.8% ahead of its earnings report. AI-focused firms also saw sharp gains, with Kingdee International (HK:0268) jumping 20%, Meitu (HK:1357) up 12%, and Kingsoft (HK:3888) gaining 6.5%.
Investor sentiment was further boosted by Beijing’s commitment to additional stimulus measures, including subsidies for electronics and initiatives to drive personal consumption. Since late January, China’s tech stocks have rallied amid optimism over AI advancements and policy support. The rise of DeepSeek ignited competition among Chinese tech giants, with Alibaba aggressively positioning itself as a leader in the AI race.
As China pushes forward in AI innovation, Alibaba’s latest move strengthens its standing in the global market, reinforcing investor confidence in the country’s tech sector.
