The stock market's biggest winners share a common thread—exposure to the rapidly expanding data center ecosystem—according to CNBC's "Mad Money" host Jim Cramer.
On Thursday, Cramer said the current market can be divided into two sectors – the data center stocks and everything else. He said the surge in artificial intelligence infrastructure is spilling into far more than big tech, pulling in industrial, power, cooling, networking and even real estate names.
Data Centers Move Into The Mainstream
"The data center, the data center, the data center," Cramer emphasized, noting that what was once a niche trade has now gone mainstream.
The S&P 500 soared to a new all-time high, topping 7200 for the first time as investors bought a wide range of businesses linked to the expansion of computing capacity. Cramer framed the rally as a connected set of winners, with data centers acting as the common thread.
Infrastructure And Power Names Surge
Companies tied to building and powering data centers are among the biggest beneficiaries. Quanta Services (NYSE:PWR), which develops power grids, is seeing strong demand as utilities race to meet rising electricity consumption.
Cramer described data centers as "giant mouths that must be fed with never-ending electricity.”
Firms like Eaton Corp. Plc (NYSE:ETN) and Vertiv Holdings Co. (NYSE:VRT) are gaining from increased demand for power management and cooling solutions, while Carrier Global Corp. (NYSE:CARR) is also seeing improving momentum tied to cooling demand.
Chip And Industrial Players Join Rally
The boom is also lifting semiconductor-related and industrial companies. Teradyne Inc. (NASDAQ:TER) has rallied as rising chip output increases the need for testing.
Qualcomm Inc. (NASDAQ:QCOM) is expanding into the data center market. In its second quarter, Qualcomm highlighted “agentic AI” as a key growth driver, pointing to rising demand for devices capable of continuous processing, sensor fusion and task orchestration.
Industrial giant Caterpillar Inc. (NYSE:CAT) is seeing strong interest in turbines used to supply power for these facilities.
Connectivity And Real Estate Benefit
Networking companies such as Ciena Corp. (NYSE:CIEN), Arista Networks Inc. (NYSE:ANET) and Cisco Systems Inc. (NASDAQ:CSCO) are also gaining as data traffic surges. Even Iron Mountain (NYSE:IRM) is capitalizing on the trend by leasing space to hyperscalers seeking additional computing capacity.
Broad-Based Economic Tailwind
Cramer argued the wide mix of beneficiaries shows the trade has broadened, calling it “A manufacturing mosaic.”
He added, “As far as I am concerned, the data center is a windfall for almost every slice of the economy.”
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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