The global excitement around artificial intelligence has pushed stock markets to new highs. But in Europe, the real buzz isn’t about software. It’s about the basic setup that makes AI possible. We are talking about data centers and the huge amounts of energy they need. Smart investors are now looking past fancy AI programs. They are betting billions on European companies that provide power, cables, and telecom services.
Leading investors like BlackRock Inc. and JPMorgan Asset Management see Europe’s infrastructure as crucial for the AI boom. These companies are making big gains, with some energy and telecom stocks climbing as much as 111% this year. Europe also aims to be less reliant on tech from the United States and Asia. Building its own data centers is a key part of that plan.
A special stock index tracks ten European companies vital to this AI ecosystem. It includes data center operators, cable makers, and energy suppliers. This index has jumped 23% so far this year. That’s better than the Stoxx Europe 600 index, which rose 12%. It even outpaces the Nasdaq 100 in some cases. Firms like Ninety One Plc are also backing these companies. They believe this is how Europe can catch up to the big U.S. tech giants.
⚡️ Europa apuesta fuerte por la infraestructura de IA ⚡️
Miles de millones están fluyendo hacia centros de datos, energía y telecomunicaciones.
Inversores como BlackRock y JPMorgan destacan la estabilidad eléctrica como clave del futuro.
La demanda de energía y cables para IA… pic.twitter.com/LidrPAuHQG
— Diario฿itcoin (@Blaze Trends)
Powering the New AI Age
The hunger for AI is driving up energy demand. Siemens Energy AG is a prime example of this trend. Its shares have soared 111% this year. Helen Jewell, an investment director at BlackRock, points out something important. She says Europe’s AI future isn’t just about software. It’s more about a steady power grid, using energy wisely, and getting power to data centers.
Siemens Energy plays a big part because it makes gas turbines. Together with GE Vernova Inc. and Mitsubishi Heavy Industries, it controls over 70% of the world’s gas turbine production. Despite its strong gains, Siemens Energy’s stock still sells for 60% less than its main U.S. competitor. Many see this as a big chance for growth. The trend picked up steam in January. That’s when former President Donald Trump announced a partnership involving SoftBank, OpenAI, and Oracle. They plan to invest billions in AI infrastructure, which further boosted confidence in companies like Siemens Energy.
Cables and Equipment: Another Winning Bet
The AI boom isn’t just about energy. Prysmian SpA, an Italian cable manufacturer, is also thriving. Its cables are vital for moving data and electricity. The company’s shares are up 41% this year. Funds like Edmond de Rothschild Fund Big Data favor Prysmian. They see its strong earning potential and lower value compared to huge firms like ASML Holding NV.
Then there’s Legrand SA, a French company. It makes electrical equipment, server racks, and cooling systems for data centers. Its income went up 20% last year, all thanks to AI. In July, Legrand even increased its annual sales forecast. This happened after demand in the AI sector shot up.
Telecoms and Networks: A Smart Strategic Move
Investments are also flowing into telecommunications. Orange SA, a major telecom company, runs over 70 data centers in Europe. It announced plans to expand and adapt some of its facilities for AI needs.
Nokia Oyj from Finland could also see benefits. European governments want to avoid relying too much on U.S. or Chinese tech suppliers. Morgan Stanley predicts that Nokia’s network switches for data centers could add up to €300 million in extra income by 2026.
These companies are attractive for more than just their tech. They represent a smart move in a changing global landscape. Xiadong Bao of Edmond de Rothschild Asset Management explained it well. He said Europe prefers to strengthen its own suppliers. This avoids depending on outside players, especially with current global tensions.
Looking Ahead: Risks and Rewards
Even with all the excitement, there are some risks. It’s hard to trade these stocks easily because few investment funds track them. Also, new rules about AI could slow things down. But the money is already flowing. Nvidia, a chipmaking giant, is expanding tech centers in the UK, France, Spain, and Sweden. This shows Europe’s serious commitment to the AI race.
For fund managers, Europe’s AI story is just beginning. As Bao put it, “The AI race is not a sprint; it’s a marathon. Money will grow bit by bit.” This means while the U.S. leads in software and chips, Europe is building the solid ground beneath it. They are focusing on energy and infrastructure. Without these basic supports, artificial intelligence simply cannot work.