The First AI Race Was About Chips. The Second May Be About Power.
AI’s first race was about building smarter chips, but the next phase may be won by those controlling the power, data centres, and infrastructure needed to run AI at scale.
Senior Market Strategist
Russell Shor is a Senior Market Strategist at FXCM, having been promoted to the role in 2025 in recognition of his depth of insight and consistent delivery of high-impact market analysis. He originally joined FXCM in October 2017 as a Senior Market Specialist.
Russell holds an Honours Degree in Economics from the University of South Africa, is a certified FMVA®, and a full member of the Society of Technical Analysts (UK). With over 20 years of experience in financial markets, his work is renowned for its clarity, precision, and strategic value across asset classes.
Page 8 of 116
AI’s first race was about building smarter chips, but the next phase may be won by those controlling the power, data centres, and infrastructure needed to run AI at scale.
Dell's blowout earnings confirm its transformation from a traditional hardware maker into a key AI infrastructure provider, but sustaining that momentum will depend on execution, competition, and the durability of AI spending
.png)
Oil, gold, and the dollar are all signalling the same thing: rising macro tension, but no clear market conviction yet.
Markets are being driven by the inflationary impact of elevated oil prices, with rising yields and a stronger dollar tightening financial conditions and pressuring gold.
The SPX500 remains supported by AI-driven earnings optimism, but rising yields, sticky inflation, and geopolitical risks are exposing the market’s growing reliance on a narrow group of mega-cap technology stocks.
America’s retail heavyweights, from The Home Depot and Target to Lowe’s and Walmart, could provide one of the clearest tests yet of US consumer resilience in 2026, revealing whether spending remains broad-based or is increasingly shifting toward essentials as economic pressures build.
The S&P 500’s 2026 rally has been driven largely by semiconductor stocks and AI optimism, but narrow market breadth, elevated valuations, and macro risks mean the market is increasingly dependent on chip-sector leadership
Oil is fuelling inflation, inflation is strengthening the dollar, the stronger dollar is testing gold, and equities are still climbing on AI optimism, creating one of the most compelling cross-asset battles of 2026.
SPX500 remains in a powerful uptrend supported by earnings, AI spending, and economic resilience, although stretched valuations and overbought technicals suggest any near-term pullbacks may create buy-the-dip opportunities.
Q1 earnings are undeniably strong, but strip out mega-cap winners like Alphabet, Amazon.com, and Meta Platforms, and the story shifts from explosive growth to a healthier, but far more uneven, corporate backdrop.
AI-driven fears sparked a sharp selloff in software stocks, but improving earnings and more balanced sentiment suggest the sector may be stabilising as investors reassess its role in the AI era.
Any opinions, news, research, analyses, prices, other information, or links to third-party sites contained on this website are provided on an "as-is" basis, as general market commentary and do not constitute investment advice. The market commentary has not been prepared in accordance with legal requirements designed to promote the independence of investment research, and it is therefore not subject to any prohibition on dealing ahead of dissemination. Although this commentary is not produced by an independent source, FXCM takes all sufficient steps to eliminate or prevent any conflicts of interests arising out of the production and dissemination of this communication. The employees of FXCM commit to acting in the clients' best interests and represent their views without misleading, deceiving, or otherwise impairing the clients' ability to make informed investment decisions. For more information about the FXCM's internal organizational and administrative arrangements for the prevention of conflicts, please refer to the Firms' Managing Conflicts Policy. Please ensure that you read and understand our Full Disclaimer and Liability provision concerning the foregoing Information, which can be accessed here.