The two factors determining the autumn market are the possibility that the leading players in the AI market will shift from AI itself to peripheral infrastructure, and the remaining upside for stocks benefiting from higher interest rates. The strength of AI demand and constraints on infrastructure development will determine the outlook for the year-end and New Year market.
An important point in understanding the autumn market is the outlook that the leading players in the AI market are likely to shift from AI itself to peripheral infrastructure, together with the view that stocks benefiting from higher interest rates still have room to rise. The sustainability of capital investment, the strength of AI demand and infrastructure constraints have been cited as supporting factors.
The focus is increasingly turning to whether data center investment will continue at the same pace, while infrastructure constraints, including securing power and developing transmission networks, are cited as factors that will determine the market’s direction. The gap between growth in AI itself and the pace of infrastructure expansion is beginning to boost the earnings of companies in peripheral areas.
Stocks benefiting from higher interest rates still have room to rise, but a shift toward selectivity is expected as PBR re-rating progresses. While wider NIMs and increased demand for funds are expected to lift bank earnings, intensifying competition for deposits and the diminishing perception of value could limit further gains.
Ultimately, the “two pillars” of the AI market and interest-rate trends are expected to determine the shape of the autumn market and lay the course for the year-end and New Year market. The article reports that the combination of AI-related stocks and stocks benefiting from higher interest rates will influence fund flows.