AI Boom Lifts Chip Stocks as Data-Center Risks Mount

AMD has joined the group of publicly traded companies valued at more than $1 trillion, driven by a sharp rally in its shares and growing investor enthusiasm for artificial intelligence. The US semiconductor maker’s stock rose 9.4% to approximately $612 during Monday’s trading session, adding roughly $200 billion to its market value in just one week. The rally reflects expectations that AMD will benefit from sustained demand for AI infrastructure, particularly processors used in data centres. The company reported second-quarter revenue of $11.5 billion, a 50% increase from the same period a year earlier. Data-centre revenue more than doubled, making it a key contributor to the company’s growth. AMD has also said it expects data-centre sales to accelerate during the second half of 2026. AMD has announced ventures involving OpenAI and Anthropic, reinforcing its position in the rapidly expanding AI hardware market. These relationships, combined with strong financial results and expectations of continued infrastructure spending, have helped make AMD a major beneficiary of the current AI investment boom. Despite reaching the trillion-dollar valuation milestone, AMD remains considerably smaller than Nvidia, the dominant company in AI-related semiconductors. Nvidia’s market value is approaching $5.5 trillion, highlighting the substantial gap between the two chipmakers. The comparison also underscores how strongly investors are rewarding companies perceived to be positioned for continued growth in artificial intelligence and data-centre computing.

Wall Street is becoming increasingly cautious about the data-centre boom, as investors question whether the sector’s rapid growth expectations and valuations can be sustained. The change in sentiment is affecting companies expected to benefit from the artificial-intelligence infrastructure boom, including data-centre operators and businesses supplying them with electricity, land and other services. One major consequence is the delay to SB Energy’s planned initial public offering, which had reportedly been valued at about US$50 billion. Concerns over investor demand and whether such a valuation is justified have made the IPO environment more difficult. The uncertainty reflects broader unease about the capital required to build data centres and the ability of operators to secure sufficient power and suitable sites. The sector is also facing growing opposition outside financial markets. Communities are objecting to the large amounts of electricity and other resources consumed by data centres, while state governments are introducing regulations that could restrict or complicate new developments. These political and social pressures are increasingly influencing corporate expansion plans and investors’ assessments of the industry. Despite the caution, demand for computing capacity linked to artificial intelligence remains exceptionally strong. Estimates cited in the article suggest that as much as US$5 trillion could be needed for AI-related infrastructure by 2030. Some prominent AI companies, including Anthropic, are still expected to pursue public offerings on schedule, indicating that investor enthusiasm for AI has not disappeared entirely. The article presents a sector at an inflection point: data centres remain essential to the AI economy, but their financial prospects are being reassessed amid high valuations, infrastructure constraints, regulatory risks and public resistance.

JPMorgan Chase CEO Jamie Dimon said spending across the artificial intelligence hyperscaler ecosystem could reach approximately $1 trillion in 2027, up from about $700 billion in 2026 and $300 billion in 2025. He said the investment surge is supporting economic growth, potentially adding roughly 1% to annual GDP, but may also contribute to inflation as companies hire workers, construct factories and power plants, and purchase equipment and materials. Over the longer term, however, Dimon believes AI could have a deflationary effect by improving productivity and efficiency. Dimon cautioned that it is too early to identify the ultimate winners of the AI boom. Comparing the current enthusiasm with the internet bubble, he noted that many well-known companies failed while less familiar businesses became major successes. He also said the financial returns from AI will not always be easy to quantify because some investments are necessary simply to remain competitive, while benefits such as improved customer experience may be difficult to measure. Beyond AI, Dimon warned that strong demand for capital linked to infrastructure, remilitarization and government deficits could push interest rates higher. He acknowledged that a market correction is possible, although he was uncertain whether AI would be the trigger. He also expressed concern that inflation could remain elevated or rise, urging the Federal Reserve to maintain its 2% target. Regarding geopolitics, Dimon urged the United States and China to engage fully on trade, AI and security ahead of a Trump-Xi summit. He called for renewed progress on an India-U.S. trade agreement and cautioned Washington against penalizing India over its Russian oil purchases without considering India’s refining needs and the effect on global oil markets. Dimon predicted that India’s economy could triple in size over the next decade and said JPMorgan would continue expanding there.

Taiwan’s benchmark Taiex index reached a record intraday high of 48,601.53 on Tuesday, supported by broad gains in technology and semiconductor stocks. The advance followed an AI-related rally on Wall Street, where investors responded positively to early indications that Meta’s AI agent may be achieving success. Taiwan’s major technology companies led the market higher: TSMC rose 0.40%, MediaTek gained 7.88%, and Delta Electronics increased 2.67%. These three companies are the largest constituents of the Taiex by market capitalization. Tuesday’s record came roughly three months after the index reached a previous high in June. Taiwanese equities have performed strongly this year as investors have continued to favor companies linked to artificial intelligence and Taiwan’s central role in global semiconductor and hardware supply chains. Standard Chartered said in July that technology accounts for approximately 88% of the Taiex, with semiconductors representing most of that exposure. The bank also noted that Taiwan produces more than 90% of the world’s most advanced chips, defined as those measuring 7 nanometres or smaller. Taiwan’s importance to the global technology industry has also been reflected in its financial markets. HSBC data showed that Taiwan overtook Canada in May to become the world’s sixth-largest stock market by equity capitalization. Investors are now awaiting Taiwan’s August export-orders data, scheduled for release later Tuesday. UOB expects the report to show continued resilience, with year-over-year growth of 63.0%, up from 61.9% in July. Such a result would reinforce expectations that demand associated with artificial intelligence remains a major driver of Taiwan’s economy and stock market.