LIVE MARKETS-AI's endless appetite makes industrials the main dish

(Updates with post on industrial, materials names that may benefit from the AI boom) US equity indexes green, but off highs; Nasdaq up ~1.5%, Dow just slightly positive Tech leads S&P 500 sector gains; Real Estate weakest group Euro STOXX 600 index rallies ~1.5% Dollar ~flat; crude slips; bitcoin up slightly; gold up >2% US 10-Year Treasury yield edges up to ~4.10% Welcome to the home for real-time coverage of markets brought to you by Reuters reporters. You can share your thoughts with us at AI’S ENDLESS APPETITE MAKES INDUSTRIALS THE MAIN DISH The search for the ‘picks and shovels’ of the AI boom is just becoming wider, with analysts at BCA Research identifying a number of industrial and materials stocks that are expected to benefit. The expansion of AI-driven computing is igniting a powerful new industrial cycle, with capital goods and materials suppliers—ranging from turbine makers to advanced cooling and grid component manufacturers—positioned as key beneficiaries in the data center value chain, BCA Research said. BCA’s curated basket of data center infrastructure companies has outperformed both the S&P 500 Capital Goods index and the broader market, combining earnings growth potential with more reasonable valuations than traditional AI leaders. First in BCA’s basket are those that are involved in the construction of the centers, such as mining giant Caterpillar (CAT.N) and equipment maker Quanta Services (PWR.N) . It also involves scores of wiring and cabling areas in which companies such as Linde (LIN.DE) and Ecolab (ECL.N) are experts, according to the brokerage. Hyperscalers are known to consume enough energy to power small cities, and so power generation and management companies like GE Vernova (GEV.N) , Eaton (ETN.N) and Schneider Electric (SCHN.PA) are the likely winners in this segment, BCA said. Efficient processing of AI workloads also requires a cool working environment, and that’s where those involved in thermal management come in. BCA’s top picks include Trane Technologies (TT.N) , Vertiv Holdings (VRT.N) , and Pentair (PNR.N) . “Data center infrastructure represents a strategic, long-term investment theme,” Irene Tunkel, chief strategist at BCA Research, said, adding that the theme allows investors to participate in the secular upside of the GenAI build-out while limiting exposure to the risks of an AI bubble. (Akriti Shah) EARLIER ON LIVE MARKETS: US STOCKS RALLY IN EARLY TRADE ON SHUTDOWN OPTIMISM CLICK HERE CAN BULLS SHUT DOWN THE NASDAQ’S DECLINE? CLICK HERE GOLDMAN SEES BONDHOLDERS SNAP UP EQUITY OPTIONS PRODUCTS CLICK HERE MAMMOTH U.S. AI SPEND GIVES DOLLAR A BOOST CLICK HERE EUROPEAN SHARES BUOYANT, DIAGEO TOASTS NEW CEO CLICK HERE EUROPE BEFORE THE BELL: FUTURES JUMP AS U.S. GOVERNMENT SHUTDOWN SEEN ENDING CLICK HERE MARKETS REJOICE POTENTIAL END TO US GOVERNMENT SHUTDOWN CLICK HERE