OpenAI’s move to court new customers Down Under is backed by the Albanese Government. Will this so-called AI bubble become an AI boom that not only powers our companies and economy, but also our stock market?

The number one reason the US stock market has been surging for three years has been the arrival of Artificial Intelligence and how the huge companies we embrace daily i.e. Apple, Microsoft, Meta (Facebook), Alphabet (Google), Amazon and other big tech names have gone a hundred miles an hour to invest in this game-changing technology.

And our market has gone along for the ride, albeit our rise has been more subdued because we don’t have the capital and company size to bankroll big bets into AI. But that’s about to change, given this headline in the AFR: “OpenAI in Australian blitz as AI giant woos start-ups, corporates”.

For the record, since October 2023, when both markets took off, our S&P/ASX 200 index is up 24.3%, while the US-based S&P 500 has surged 90%! The starting point for this rise was the fall in inflation and the commencement of interest rates going down, but then the commitment to AI spending, led by a largely unknown company called Nvidia that has risen 337%, turbocharged US stock markets.

In fact, the tech heavy Nasdaq Index is up 121% since the start of 2023 as it started its big rise earlier than the less tech-influenced stock indexes.

From October, the Dow Jones Index is up only 64% and if you compare it to when the Nasdaq started its surge in early January 2023, it’s up only 40%. That’s because it’s less tech company dominated. There are only four or five companies that you might call tech ones in the 30 stocks that make up the Dow Jones Index.

As you can see, tech has been a powerful influence on stock market rises and now as the AFR’s technology editor Paul Smith reports: “OpenAI will offer start-ups backed by the country’s three largest venture capital firms free access to its services as it launches a major push into Australia, opening a local headquarters in a blitz that will include significant investments and partnerships with big companies.”

This company owns something many of us use called ChatGPT, which answers our questions via its AI technology.

Here are the main takeaways from the story:
1. Commonwealth Bank, Coles, Wesfarmers, Fortescue and REA Group have inked deals with the huge Silicon Valley private company.
2. It’s working with local business funders — Blackbird Ventures, Airtree Ventures and Square Peg Capital — so they can give free credits for start-up tech-oriented operations.
3. OpenAI is trying to beat the likes of Google, Anthropic and China’s DeepSeek in bringing its AI product here to establish a stronghold position.
4. It has cracked a deal with La Trobe university to provide its ChatGPT Edu tool to all students and staff by 2027.

OpenAI’s move down under is backed by the Albanese Government and as the AFR reported “its global chief strategy officer, Jason Kwon, was a notable guest as Industry Minister Tim Ayres launched the Albanese government’s national AI strategy in Sydney.”

Speaking at the Museum of Contemporary Art on Tuesday, he argued it would be an “act of intergenerational robbery” for the government to close the door on global AI companies as he ruled out the introduction of a restrictive AI Act to instead focus on safety guardrails.

AI and the big companies that own and power it are coming. And the more businesses embrace it and end up being more productive, the more likely the so-called AI bubble will become an AI boom that not only powers our companies and economy, but also our stock market!

As an unashamed player of stocks for myself, as well as my financial planning clients and Switzer Report subscribers, I’m happy the AI bubble or boom is coming to Australia companies of today and tomorrow!