Ben Powell, chief investment strategist for APAC at BlackRock, said that the wave of capital pouring into artificial intelligence is far from peaking. He argued the sector’s “picks and shovels” suppliers — from chipmakers to energy producers and copper-wire manufacturers — remain the clearest winners as hyperscalers race to outspend one another.
Powell told CNBC that the surge in AI-related capital expenditure shows no sign of slowing down. “The capex deluge continues. The money is very, very clear,” he said, adding that BlackRock is focused on what he called a “traditional picks and shovels capex super boom, which still feels like it’s got more to go.” AI infrastructure has been a major driver of investment this year, though some investors have questioned how long the Bubble can last.
Powell also said that leading tech firms have only begun to tap capital markets to fund the next phase of AI expansion, suggesting additional capital is on the way. “The big companies have only just started dipping their toes into the credit markets… feels like there’s a lot more they can do there,” he added.
He also said the hyperscalers are “behaving as if coming second would effectively leave them out of the market.” That mindset, he added, has pushed firms to accelerate spending even at the risk of overshooting.
Powell also noted that much of that capital is likely to flow to the companies powering the AI build-out rather than model developers, reinforcing a growing view among global investors that the most durable gains from the AI boom may lie in the hardware, energy and infrastructure ecosystems behind the technology.
“If we’re the recipients of that cash flow, I guess that’s a pretty good place to be, whether you’re making chips, whether you’re making energy all the way down to the copper wiring,” Powell said. He added that he was expecting “positive surprises driving those stocks in the year ahead.”
Powell also mentioned in a recent media roundtable that the ongoing AI wave is not a hype-led rally but as a structural economic redesign. He also said that what concerns him most is not valuations or competition among model builders but something far more fundamental: electricity. The world, he explained, simply does not have enough power infrastructure to support the exponential growth in AI compute needs. “The silicon brain needs energy just the way humans need calories to think,” he said.