Global industrial and technology stocks including Oracle and Schneider Electric rallied Wednesday after U.S. President Donald Trump unveiled a massive artificial intelligence investment push.
Trump Tuesday announced a private-sector investment of up to $500 billion to fund AI infrastructure, sparking interest in stocks that help build the architecture behind the technology.
BIG TECH JUMPS
Oracle, one of the companies involved in the effort, jumped more than 9.5% in U.S. early market trading. Other AI-linked firms in the U.S. including chip giant Nvidia, Broadcom and Arm gained between 2% and 6.5%.
Microsoft, another partner in the initiative, rose 2%.
In Europe, many of the stocks hit record highs.
French group Schneider Electric, a major supplier of electrical equipment and other infrastructure behind data centers, soared 3.4% to a new high in Paris.
Italian cable maker Prysmian, which last year bought U.S.-based Encore Wire, gained 3.3% to hit a lifetime peak. Germany's Siemens Energy and ABB, which provide electric hardware for AI infrastructure, rose 6.7% and 3.8%, respectively.
"These companies are part of the investment baskets focused on electrification, data centers and energy transportation infrastructure, which benefit from the ongoing trends in AI, electric vehicles and more," said Angelo Meda, head of equities at Banor SIM in Milan.
FUNDING DOUBTS
The Stargate initiative is a joint venture between ChatGPT creator OpenAI, SoftBank, Oracle and other equity backers. It will initially deploy $100 billion and the rest of the funding is expected over the next four years.
SoftBank and OpenAI will lead the project. The Japanese tech investor will have the financial responsibility while OpenAI will take charge of the operations, the ChatGPT maker said.
The plan, however, lacked details on how the money would be spent and did not specify how the firms would source the funds.
It was met with immediate skepticism from rival Elon Musk, who helms xAI and has been one of the most vocal critics of OpenAI, which he co-founded but later left.
"They don't actually have the money," Musk said on X, adding that "he had on good authority" that SoftBank has secured "well under" $10 billion.
Reuters could not independently verify Musk's claims.
Rene Haas, CEO of Arm, told CNBC on Wednesday the consortium is still working out the financial details of Stargate.
Several analysts said they expect more companies to join and most of the funding was likely to come from the joint venture partners. They said the initiative could include projects already in works at some of the companies.
"The founding partners have helped drum up the initial investment and it is very likely this list will be expanded upon," said Ben Barringer, technology analyst at Quilter Cheviot.
MORE TO COME
"It is interesting that some data centers are already said to be in construction, and we can assume that some of this has been done using Microsoft and Oracle's capital expenditure. However, we do not yet have enough detail and will need to wait and see how it plays out."