There were concerns about defective leadership and plans for record capital investment weighing on the magnificent seven trade last week.
The Roundhill Magnificent Seven ETF (Bag) 2.4% fell over the last five trading days, led by alphabet (Cook. Lady) Drop 9.2% and a decline of 3.6% Amazon.
And the group is just the latest front end. The technology sector is still recovering from the sales driven by Deepseek last month, after investors ended over the fears of a cheaper open source language model.
But the development of Deepseek should be considered as a catalyst for the industry, not a front end, according to chief executives and industry experts. One former Openai -employee told me that the market should see Deepseeek developments as “win,” given their potential to accelerate the innovation and adoption of AI.
“Deepseek's R1 model is an innovative development… Being excited about rising science is something we should all want, and seeing the cost of critical resource coming down is also something we should want,” explains Zack Kass, before -The Go- openai go- openai to market.
And that feeling has been echoed by Tech Big chief executives. Sundar Pichai's CEO of the company described the company's work as “tremendous” on the call of his company's earnings earlier this week, while Meta (Meta) CEO Mark Zuckerberg said there were “several novel things” that Deepseek did that the company was “still spending.”
For investors looking to exchange for the next AI growth period, it may be time to look beyond hyperscalers and chip makers like Nvidia (Nvda) and AMD (Amd).
The play: AI network stocks – the group providing the infrastructure for AI applications.
And here's why: As AI models like R1 Deepseeek significantly increase computer demand, the need for fast networking solutions will only grow. Chun Him Cheung Bank of America wrote in a note to clients this week that a cheaper cost for a computer should lead to “wider AI-adoption” and demand should be “firm.”
T. Rowe Price of Science and Technology Portfolio Manager Equity Strategy Tony Wang told me He sees the group as a “good situation,” while Ruben Roy Stifel also sees a face-to-date, citing the R1 Deepseeek model as the driver of global demand for robust and rapid networking infrastructure.
“The networking aspect of it is definitely where there is congestion in the provision of AI infrastructure,” Wang told me. “We will need to see much more innovation in that tier. “
Roy sees Ciena (Song), Cohesive (Cohr), and celetica (Lock) As the main beneficiaries as “AI workloads become more efficient to run.”
“The basic dive for moving data is going to go more challenging to implement … the speeds of the interface are moving higher, and the challenges of moving data around can continue to become more complex, ”Roy explained.
