Piper Sandler's Craig Johnson Says AI Leadership Is Rotating to Industrials and Energy as 10-Year Treasury Yields Approach 5%, Warns Break Above 4.8% Could Push Yields to 5.25%
Piper Sandler chief market technician Craig Johnson stated on September 8 that AI investment leadership is shifting from hyperscalers to industrials and energy companies, citing the NASDAQ's 14-week streak without a new record high and new highs in energy stocks. He warned that a sustained break above 4.8% in the 10-year Treasury yield, which stood at 4.8% on September 8, would likely drive yields towards 5.25%, increasing discount rates and pressuring long-duration industrial multiples. Charles Schwab Asset Management CEO Omar Aguilar echoed this, suggesting AI's next wave will benefit labor-heavy industries like industrials, financials, materials, and energy through productivity gains. Caterpillar, with its power generation solutions for data centers and a $72 billion backlog extending into 2028, is highlighted as a key beneficiary of this shift.
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