DeepSeek AI Integration into WeChat Messenger Causes Tencent Shares to Rise, Baidu to Fall

Chinese tech giant Tencent has integrated AI model DeepSeek into its WeChat messaging app, joining other Chinese government agencies and service providers that have also integrated the AI. The move has helped boost investor confidence in Tencent’s prospects, especially after several successful gaming releases that have seen the company’s shares rise more than 70% over the past year.

Image source: unsplash.com

Shares of Tencent rival Baidu, which also built DeepSeek into its search engine, were down 8.8% in afternoon trading, partly due to profit-taking ahead of tomorrow’s earnings report.

Tencent’s rise comes as investors are excited about Chinese tech companies following Chinese President Xi Jinping’s meeting with e-commerce giant Alibaba founder Jack Ma on Thursday. The show of support for the private sector from Chinese officials comes on top of a surge in Hong Kong stocks fueled by growing AI opportunities.

Image Source: Bloomberg

«Widespread adoption of AI could boost China’s EPS by 2.5% per year over the next decade, according to analysts at Goldman Sachs. “As promising as AI is for China’s growth trajectory, we believe strong policy incentives are still needed to address deep-rooted macroeconomic challenges and ensure sustainable capital gains.”

The release of the DeepSeek R1 reasoning model on January 20 sent shockwaves through global stock markets, wiping more than a trillion dollars off the value of the most advanced U.S. AI companies. At the same time, it sent Chinese stocks soaring by $1.3 trillion as investors rushed to change horses in midstream.