Magnificent Seven ETF Recovers from DeepSeek-Related Headwinds
As concerns over lackluster guidance and record capital investment plans subsided, the Roundhill Magnificent Seven ETF (MAGS) rebounded by 2.4% over the past five trading days. This follows a decline of 9.2% and 3.6% for Alphabet (GOOG, GOOGL) and Amazon (AMZN), respectively.
DeepSeek: Catalyst or Headwind?
Despite the DeepSeek-driven sell-off last month, industry experts maintain that the development should be viewed as a catalyst. Former OpenAI employee Zack Kass emphasizes the potential to accelerate AI innovation and adoption, considering DeepSeek's R1 model a "breakthrough."
Big Tech CEOs Echo Sentiment
Alphabet CEO Sundar Pichai and Meta CEO Mark Zuckerberg expressed excitement about the advancements made by DeepSeek, highlighting its potential for novel applications.
AI Network Stocks: The Next Growth Phase
As AI models like DeepSeek's R1 increase compute demand, demand for high-speed networking solutions is expected to soar. Analysts anticipate wider AI adoption and robust demand for infrastructure.
Top Beneficiaries of AI Network Growth
Ciena (CIEN), Coherent (COHR), and Celestica (CLS) are identified as top beneficiaries of the growing demand for robust and high-speed networking infrastructure. Increased demand from hyperscalers and the industry's transition to custom compute present significant growth opportunities.
Arista Networks: Bullish Outlook
Morgan Stanley analyst Meta Marshall recommends Arista Networks (ANET) as a promising AI networking company. Following a recent DeepSeek-driven sell-off, shares are now seen as more attractive.