Norway’s sovereign wealth fund, the world’s largest investor, said developments like DeepSeek’s AI models will be a positive catalyst for the sector as it reported bumper profits from a boom in tech stocks like Nvidia (NVDA).
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The fund, which owns about 1.5% of all equity markets globally, delivered full-year profit of 2.5 trillion kroner ($222.4 billion) in Fiscal 2024, surpassing last year’s record.
Norges Bank Investment Management (NBIM) said in an earnings report today, January 29th, that the fund’s return on investment came in at 13% for the year.
AI Stocks Fuel Returns
Equities delivered a return of 18% for the year, fueled but a boom in AI stocks. Fixed income produced a 1% return, while unlisted renewables delivered a negative 10% return.
“The fund achieved very good returns in 2024, as a result of a very strong stock market. The American technology stocks in particular performed very well”, said CEO Nicolai Tangen.
NBIM manages Norway’s Government Pension Fund Global, which is invested in about 9,000 companies around the world. It is a leading shareholder in NVDA, with a 1.3% holding in the company, as well as other tech firms such as Amazon (AMZN), Microsoft (MSFT) and Apple (AAPL).
DeepSeek Sparks Reappraisal
Speaking at the press conference after the release of the results, Tangen noted that the scale of the selloff in some tech names on Monday indicated investors had been surprised by DeepSeek, which caused consternation about its apparent ability to develop cheaper AI models.
But he suggested that this would be a good thing in the long run. “The fact that there are now cheaper language models available is positive, it’s positive for the democratization of artificial intelligence,” he said. “So, you should get more penetration of that technology around the world when the cost is lower, so that’s a general positive.”
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