☕️ Deep(Seek) hit

DeepSeek’s AI surge shakes Nvidia’s throne, sends markets reeling

January 28, 2025

Good morning.

Nvidia’s US$600 billion ($954.78 billion) market cap implosion overnight – driven by China’s budget AI disruptor DeepSeek – handed the crown of world’s most valuable company back to Apple.

DeepSeek’s cut-price models threaten to shake Nvidia’s dominance fuelling scepticism over Big Tech’s planned US$200 billion AI spend this year.

The fallout didn’t stop with Nvidia. Energy stocks tied to AI-driven demand cratered, and anyone holding tech-heavy portfolios felt the sting.

But spare a thought for Nvidia CEO Jensen Huang, whose personal fortune took a US$13 billion hit. With Microsoft, Meta, Apple and Tesla reporting this week, it’s game on for Big Tech—so brace for more turbulence.

ASX as at market close. Commodities and crypto in USD.

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Market movers

Regis Resources and Westgold Resources nosedived on valuation-driven downgrades on Friday, leading a gold miner rout that defied rising bullion prices.

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The quick sync

  • AI shakes up Australian tech, but unicorns prioritise upskilling over replacing engineers. (Capital Brief)

  • AXA’s Ecaterina Bigos on navigating Trump’s tariffs, betting against China, and why AI will dominate markets through 2025. (Capital Brief)

  • Kylie Frazer bets on AI reshaping venture capital, taking the lead as UNSW Founders’ first investor-in-residence to champion deep tech startups. (Capital Brief)

  • Despite AI’s rise, law firms cling to the billable hour, rewarding relentless effort with six-figure bonuses but fuelling debate over efficiency and wellbeing. (FT)

  • ASIC's Joe Longo defends Australia's 'twin peaks' regulatory model while prioritising private market oversight and simplification in 2025. (Capital Brief)

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Trading floor

M&A

  • Tanarra Capital targets a $400M exit from Health Metrics, a growing SaaS player. (AFR)

  • Musk’s X debt sale includes a $6B xAI stake sweetener amid market turmoil from DeepSeek’s rise. (Bloomberg)

  • Ravenswood Gold Mine sale heats up, with deadline extension to attract Chinese buyers. (The Australian)

  • Trump plans to decide on TikTok's future in 30 days, with talks including Oracle overseeing operations. (Reuters)

  • Hedge funds eye Southern Cross Media Group, as its market value drops. (The Australian)

  • Anglo American leads 2025 European M&A target predictions amid a mining sector deal surge. (Bloomberg)

  • Blackstone may acquire The Star's Sydney slot machines if it fails, to enhance Crown Resorts' NSW operations. (The Australian)

  • HEX acquires EntryLevel to enhance its skills training focus for future work education. (HEX)

  • BHP and Rio Tinto are eyeing large mergers for more copper exposure as iron ore demand falls. (The Australian)

Capital Markets

  • Local inflation data this week will shape the Reserve Bank of Australia's February rate decision. (Capital Brief)

  • Tesla challenges EU tariffs on Chinese EVs amid 2024 delivery decline, aiming for a 2025 rebound with new models. (Capital Brief)

  • GCI debuts a $100M fund for mid-market corporate loans, closing its first $28.3M deal. (AFR)

  • Humanity Protocol hits $1.58B valuation, challenging Worldcoin with palm-scan identity verification. (Capital Brief)

  • Meta will invest US$65B in AI in 2025, including a huge data center and expanded computing power. (Bloomberg)

VC

  • Chinese AI startup DeepSeek’s low-cost AI models challenge US dominance, shaking global tech markets and exposing export control vulnerabilities. (Capital Brief)

  • New Zealand EV charging start-up Kwetta raises $16.2M for global expansion of ultra-fast EV charging infrastructure. (AFR)

  • Jun Bei Liu and Jason Todd launch new investment firm TenCap in Sydney. (AFR)

People moves

  • Ex-JPMorgan equity capital markets co-head Simone Haslinger becomes CEO of East Coast Capital Management. (ECCM Post)

  • Kylie Frazer joins UNSW Founders to boost deep tech ventures as AI cuts software costs. (Capital Brief)

  • Casey Flint transitions from Square Peg to AWS to focus on AI. (Startup Daily)

  • KordaMentha recruits KPMG veterans to lead new defense advisory business. (AFR)

  • UBS cuts hundreds of jobs in Switzerland as part of its integration with Credit Suisse. (Bloomberg)

  • Citigroup’s global head of private banking, Ida Liu, resigns in the latest high-profile exit as CEO Jane Fraser wealth overhaul. (Bloomberg)

☝️ Know about a deal or people move we don’t? Hit reply.

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