AI Stocks Rally and Drive Global Market Interest

Jefferies expects earnings for the S&P 500 AI basket to grow at a 48% annualized rate through 2027, against 23% for the broad index and 12% for the index excluding AI names . The spread, rather than the headline growth rate, is the argument: it implies the index's aggregate earnings trajectory is now substantially a function of a single theme, driven mainly by memory, advanced packaging and AI server capital spending.

The clearest illustration that week was IREN IREN, which rallied after Microsoft MSFT accepted delivery of Horizon 1, a 50 megawatt liquid-cooled AI datacenter deployment in Childress, Texas, and Nvidia NVDA granted the company Exemplar Cloud status for the GB300 NVL72 platform . The deployment sits inside a five-year, $9.7 billion cloud services agreement with Microsoft, and IREN raised its 2026 AI cloud run-rate revenue target above $4 billion from $3.7 billion, roughly 85% of it contracted .

That is the Jefferies number in miniature: hyperscaler capital spending converting into contracted revenue at a neocloud operator, which converts into hardware orders at the silicon vendors. The concentration cuts both ways, because the same chain means a single hyperscaler capex revision propagates through every layer of it.

What to watch is the next round of hyperscaler capex guidance, and the contracted-versus-speculative capacity ratio at the neocloud operators, which is where the credit risk in the AI buildout actually sits.

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