Alibaba (BABA) has rolled out a new artificial intelligence (AI) model it says can outperform leading models from DeepSeek, OpenAI, and Meta Platforms (META). 

Alibaba's U.S.-listed shares rose 3% in early trading Wednesday following the news. Shares of Meta and OpenAI backer Microsoft (MSFT) were both slightly lower. 

The Chinese tech giant posted on WeChat that its upgraded Qwen 2.5 Max performed on par with Amazon (AMZN)-backed Anthropic's Claude 3.5 Sonnet, and surpassed OpenAI's GPT-4o, DeepSeek's V3, and Meta's Llama 3.1 in some benchmark tests. 

The news comes just days after concerns about the surging popularity of an app from Chinese startup DeepSeek, which runs on an AI model it claimed can perform on par with American rivals at a fraction of the cost, sent U.S. tech stocks into a tailspin Monday. After a rebound in Tuesday's session, the tech sector fell back into the red Wednesday, weighing on the major indexes. 

AI chipmaker Nvidia (NVDA) shares were down nearly 5% Wednesday, leading Dow Jones Industrial Average decliners and among the top decliners on the S&P 500 and Nasdaq. Shares of Broadcom (AVGO), Palantir (PLTR), and other AI darlings over the past year also were lower.

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