AI Investment Spurs Surge in European Industrial Stocks
Milan/Paris, February 23 (Reuters) - European industrial giants, including Schneider Electric and Prysmian, witnessed a sharp uptick in stock prices on Wednesday as investors welcomed President Donald Trump's announcement of significant artificial intelligence (AI) investment.
Trump unveiled plans for $500 billion in private-sector funding to develop AI infrastructure, triggering buying frenzy in companies involved in building and connecting the underlying technology.
Shares of Schneider Electric, a prominent data center equipment supplier, hit a record high in Paris with a 3.4% surge. The French multinational recently acquired Motivair, a leading provider of cooling solutions for data centers, and is collaborating with Nvidia on cooling system designs.
Italian cable manufacturer Prysmian, which purchased Encore Wire in the United States last year, gained 3.3% and also reached an all-time high. The company is actively exploring M&A opportunities in the U.S. data center component sector.
Under the Stargate initiative, a joint venture involving OpenAI, SoftBank, Oracle, and other investors, an initial $100 billion investment will be deployed. The remaining funds are anticipated to be invested over the next four years.
A Prysmian spokesperson highlighted that these investments will positively impact the power grid beyond the direct benefits to industrial and construction businesses.
Other companies that stood to gain include Siemens Energy and ABB, which provide electrical hardware for AI infrastructure. Their stocks rose by 7.5% and 3.1%, respectively, to record highs.
Angelo Meda, head of equities at Banor SIM, explained that these companies are part of "investment baskets focused on electrification, data centers, and energy transportation infrastructure," industries set to benefit from trends in AI, electric vehicles, and other emerging technologies. In Europe, which lacks major tech giants, these stocks offer an avenue to capitalize on these trends.
Trump's AI investment announcement comes amid a surge in AI investments following the launch of OpenAI's groundbreaking ChatGPT in 2022. Businesses across industries are actively integrating artificial intelligence into their offerings.