AI, power consumption, tariffs: 3 Market themes for 2025

AllianceBernstein CIO of Concentrated US Growth Jim Tierney unpacks three key market themes investors should watch in 2025 with Seana Smith and Madison Mills. The first theme is artificial intelligence, with Tierney stating, "It really has dominated the market this year, and I think it will dominate the market next year." He describes the AI trajectory as a "train ride," with semiconductors benefiting heavily in 2024. The next stop, he predicts, will be implementers, hyperscalers, and software companies in 2025, dubbing it "the year of the software company" for the AI trade. The second theme centers on power consumption. Tierney notes, "Because of efficiencies, we haven't had any growth in power consumption for decades, and we're starting to get to the point where there will be growth." He points to developments like data center expansion and reshoring, suggesting power consumption will be "an underestimated long-term driver of economic growth in the US." The third theme involves President-elect Donald Trump's proposed tariff policy. Tierney highlights Constellation Brands (STZ) as a potential beneficiary of these policy shifts.
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