Market Information Tuesday 28 January 2025

Chip stocks in Europe and the US saw significant losses after Chinese start-up DeepSeek unveiled an AI model that rivals US giants, while requiring significantly fewer chips. This development challenges the prevailing belief that more computing power and chips are essential for advancing AI, raising concerns over long-term investments in AI infrastructure. This development could push American companies to focus on building more efficient AI models, potentially reducing their massive investments in chips and related infrastructure.

Brussels faces mounting pressure from businesses and EU member states to reduce sustainability regulations in response to Donald Trump’s deregulation efforts. Critics argue that current EU regulations hinder investment and competitiveness, with major companies and countries like France and Germany calling for regulatory pauses and delays. European Commission president Ursula von der Leyen is committed to simplifying sustainability reporting, but there are concerns that easing too much could undermine the EU’s goal of using sustainability as a competitive advantage.

Japanese investors have offloaded €41bn in Eurozone government bonds over six months due to rising Japanese interest rates and European political instability. This trend is reshaping global financial markets and adding pressure on European governments facing high borrowing costs. Japanese investors are increasingly seeking domestic returns, altering international bond market dynamics.

The 6M Euribor decreased with 1 basis point to 2.58% compared to previous business day. The 10Y Swap decreased with 1 basis point to 2.50% compared to previous business day.

In the attachment, today’s market data on money and capital market rates as well as other rates are presented.