The U.S. stock market surges indicator: cloud computing + data center

Overnight, the stock prices of the three major cloud companies in the U.S. surged again. Alphabet Inc. Class C-A (GOOGL.US) saw its stock price rise by 4.88%, pushing its market capitalization above Apple Inc. (AAPL.US) to become the second largest globally; Microsoft Corporation (MSFT.US) increased by 4.93%, with a cumulative gain of about 25% over the past three trading days; Amazon.com, Inc. (AMZN.US) rose by 4.58%, with its market cap surpassing $3 trillion. In addition, the data center concept stock CoreWeave soared by 19.49%, and Nebius rose by 11%. Recently, market funds have continued to flow into cloud computing and AI software-related sectors. Driven by the digital transformation of enterprises, accelerated AI application deployment, and growing demand for cloud services, cloud companies have performed better than the broader market. The three major cloud companies are set to report a collective surge in Q2 2026 earnings. Previously, the market was most concerned about the huge investments technology giants were making in AI with uncertain returns. However, the latest earnings reports have completely dispelled these concerns: Amazon.com, Inc. AWS: Quarterly revenue reached $42.2 billion, a year-on-year increase of 37%, marking the fastest growth rate in 18 quarters, with AI-related annualized revenue exceeding $25 billion. Microsoft Corporation Intelligent Cloud: Azure saw a remarkable year-on-year increase of 43%, surpassing the company's prior guidance, with annualized revenue exceeding $100 billion for the first time. Alphabet Inc. Class C Cloud: Quarterly revenue skyrocketed by 82% year-on-year, far exceeding market expectations, and the operating profit margin significantly increased to 35.6%. This solid data proves that AI investments are transitioning from a burning cash phase to a revenue-generating rent-collecting model. Not only did the cloud companies achieve impressive current performance, but future demand visibility is also extremely high. Currently, the total backlog of orders for cloud services from tech giants has surpassed $2.3 trillion, reflecting a quarter-on-quarter increase of 16%. In response to the supply-demand imbalance, giants like Amazon.com, Inc., Alphabet Inc. Class C, and Meta have raised their capital expenditure forecasts for the full year of 2026 (for example, Amazon.com, Inc. has raised it to $220 billion). Major companies domestically and internationally are simultaneously ramping up investments in intelligent computing centers and GPU clusters. Amazon.com, Inc. CEO Andy Jassy even stated that, even with significant increases in capital expenditure, the computing power supply in 2026 and even 2027 will still not be able to fully meet customer demand, providing a demand guarantee for the cloud computing supply chain for years to come. It is worth noting that the current market investment logic is undergoing profound changes. Funds are no longer simply favoring hardware-selling companies but are clearly concentrating on cloud service providers with profit realization capabilities. AI Infrastructure Soft and Hardware Transition Domestic institutions are focusing on deeply undervalued computing power leasing. Sealand released a research report stating that Meta's transition to cloud computing is mainly due to considerations of its own business model, with AI computing power expected to maintain long-term growth. It is projected that the supply-demand tension for AI computing power in China will intensify, and the long-term growth logic of the computing power leasing industry is relatively certain, now entering a performance release dividend period. China Securities Co., Ltd. published a research report indicating that in Q2 2026, the capital expenditure of leading North American cloud companies continued to rise sharply. The capital expenditure guidance for four North American cloud companies for 2026 totals approximately $720 billion to $745 billion, reflecting that North American cloud companies are still expanding around AI infrastructure. Currently, the prosperity of the AI computing power supply chain remains strong, but the market has recently shown noticeable adjustments, indicating some overcorrection. For the future, it is recommended to continuously monitor: first, the growth of annual recurring revenue (ARR) for large models, especially in coding scenarios, as large models in North America have recently engaged in price promotions; if ARR growth faces short-term bottlenecks, it may impact market expectations for future computing power demand; second, the implementation and development of large models in application scenarios beyond coding; third, the price trends of the computing power inflation chain in the coming period; fourth, the financing situations and market risk preferences across the various stages of the AI supply chain. Additionally, given the heavy positions in the AI supply chain in Q2, the recent market adjustment has shown signs of high and low divergence, suggesting a focus on undervalued, high-dividend stocks. Hong Kong stocks related to cloud computing and data centers include: GBA AI COMP (01396), KINGSOFT CLOUD (03896), GDS-SW (09698), BABA-W (09988), China Telecom Corporation (00728) (Tianyi Cloud), among others. This article is reproduced from the "Hong Kong Stock Connect" WeChat official account, GMTEight editor: Jiang Yuanhua.