Washington: The inauguration of US President Donald Trump on January 20 triggered a week-long surge in US tech stocks and Bitcoin, buoyed by Trump's positive remarks on developing the tech and AI infrastructure in the US. This surge, however, faced a sudden dip on Monday due to the impact of China's DeepSeek AI bot.
According to Anadolu Agency, Trump's ambitious promises to make the US the "crypto capital of the planet" and a "Bitcoin superpower" were pivotal in driving the market boom. He emphasized his vision for the US to lead in technology, science, manufacturing, AI, and space. Trump's previous term was marked by a nationalist and protectionist economic policy, which he vowed to continue. His declarations at the annual Bitcoin Conference on July 28, 2024, further emphasized his commitment to advancing the US's position in the global tech and crypto space.
Bitcoin witnessed a significant 3.1% rise from January 17 to 24, reaching a historic high of over $109,000 on January 20. In contrast, Ethereum's price saw a slight decline of 1% during the same period. This financial upswing was mirrored in the stock market, where companies associated with Trump's tech initiatives experienced notable gains.
During the inauguration, prominent tech figures such as Mark Zuckerberg, Tim Cook, Sundar Pichai, Jeff Bezos, and Elon Musk were in attendance, highlighting the close ties between the tech sector and the Trump administration. Notably, Elon Musk was appointed as the administrator of the Department of Government Efficiency, a move that signaled the inclusion of influential business leaders in Trump's governance.
Trump's inauguration fund amassed a record $170 million, with contributions from major corporations like Microsoft, Google, Ford, General Motors, Toyota, Chevron, Apple, Amazon, Meta, and OpenAI. These donations symbolized a robust confidence in Trump's economic policies and were reflected in the rising stock prices of these companies.
The announcement of "The Stargate Project," a new AI infrastructure company, further fueled market optimism. This initiative, expected to be the largest AI infrastructure project in history, aims to maintain the US's technological edge by collaborating with industry giants like OpenAI, Nvidia, Oracle, SoftBank, Microsoft, ARM Holdings, and MGX. OpenAI revealed plans to invest $100 billion, potentially expanding to $500 billion, in enhancing the US's AI infrastructure.
From January 17 to 24, tech stocks soared, with companies like SoftBank, Oracle, ARM Holdings, MGX, Nvidia, and Microsoft seeing substantial increases. Other major tech firms, including Google and Amazon, also experienced stock price hikes, reflecting a broader market confidence in Trump's economic vision.
In a speech at the Davos summit, Trump reiterated his commitment to making the US a manufacturing superpower and the global leader in AI and crypto. He advocated for reduced taxes and imposed tariffs to encourage domestic production, a stance that resonated positively with investors.
However, the market faced challenges on Monday as China's DeepSeek AI bot gained traction, causing a decline in US tech stocks. DeepSeek's AI assistant, offering cost-effective and data-efficient services, posed a competitive threat to US tech leaders like Nvidia, Oracle, Meta, and Google.