Shares of Bloom Energy (BE 13.14%) rocketed 18.5% higher on Wednesday as of 12:35 p.m. ET.

There wasn’t any news specifically from Bloom today; however, last night’s bombshell guidance from Oracle (ORCL 35.14%) is likely boosting Bloom by association, given that Bloom inked an important data center partnership with Oracle in July.

Oracle announces AI hypergrowth, and it will need lots of energy

Bloom surged in July after it announced a landmark deal with Oracle on July 24. For reference, Bloom’s energy servers can transform natural gas or hydrogen into electricity without combustion, producing electricity from an abundant source like natural gas in a cleaner way to meet escalating electricity demand.

Bloom had served utilities and other power users in the past, but the July deal with Oracle was the first direct agreement with a cloud hyperscaler.

Therefore, when Oracle provided astonishing backlog growth in its cloud infrastructure (IaaS) business last night, that also improved the outlook for Bloom, which will likely play a role in providing electricity to those data centers. Oracle reported $455 billion in remaining performance obligation in its cloud IaaS business, up an astounding 359%. On the conference call with analysts, CEO Safra Catz noted she expects cloud infrastructure revenue to grow from $18 billion this year to a stunning $144 billion in fiscal 2030 — over just a matter of four years.

Needless to say, that much growth will require Oracle to build a lot more data centers, which will likely be served in part by Bloom’s energy servers.

Bloom looks expensive, but AI growth is off the charts

After today’s rally, Bloom trades at 76.5 times next year’s earnings estimates. That’s very expensive for a low-margin hardware business, but Oracle’s multiyear guide appears to have lifted the prospects for Bloom’s growth over the 2027-2030 time frame.

So while Bloom’s valuation makes it risky at these levels, its artificial intelligence (AI)-related growth story keeps getting better.

Billy Duberstein and/or his clients have no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Oracle. The Motley Fool has a disclosure policy.

Shares of American Eagle Outfitters (AEO 0.21%) rallied 19.8% in August, according to data from S&P Global Market Intelligence.

American Eagle capitalized on July’s optimism regarding its new ad campaign starring actress Sydney Sweeney when President Trump endorsed the company’s campaign in early August. Then later in the month, American Eagle announced a collaboration with Kansas City Chiefs tight end and Taylor Swift fiancée Travis Kelce.

American Eagle’s investment in celebrity pays off

American Eagle’s stock got a bump in late July when it launched a controversial ad with actress Sydney Sweeney with the byline, “Sydney Sweeney has Great Genes Jeans.” While the stock then faded after an initial lift, President Trump weighed in in early August, writing on his social media platform Truth Social that the ad was, “the HOTTEST out there…the jeans are flying off the shelves.”

In response, investors bid up the stock, thinking the controversy might boost publicity for the brand and therefore subsequent sales.

Then later in the month, American Eagle announced a limited addition collaboration with Travis Kelce’s “Tru Colors” clothing line, which Kelce began in 2019. The new limited edition collection is to be unveiled in two “drops,” with one on Aug. 27, and another upcoming on Sept. 24. As luck would have it, the collaboration announcement came one day after Kelce announced his engagement to music star Taylor Swift.

So, American Eagle nabbed a marketing coup in both late July and into August, grabbing support from the President, as well as arguably two of the biggest celebrities in sports and entertainment.

What will it mean for the stock, though?

The high-profile marketing push — both planned and unplanned – appeared to boost American Eagle’s near-term outlook. On Sept. 3, the company reported its second-quarter earnings results for the quarter ending Aug. 2, beating analyst expectations even though sales and comparable-store sales were each down 1%.

However, management said it was seeing “an uptick in customer awareness, engagement and comparable sales,” as a result of the Sweeney and Kelce campaigns, and projected comps to return to positive low single digits in both Q3 and Q4. That improvement would appear to validate the impact of the Sweeney and Kelce campaigns.

That said, despite a near-20% gain in August and a 20%-plus gain in September thus far, American Eagle’s stock is only up about 12.8% on the year and is still actually 2.3% below where it was one year ago. A cautious consumer, high interest rates, and the Trump administration’s tariffs have all acted as headwinds to the clothing retailer, as it has to many retailers.

Billy Duberstein and/or his clients have no position in any of the stocks mentioned. The Motley Fool recommends American Eagle Outfitters. The Motley Fool has a disclosure policy.

Matt DiLallo has positions in Brookfield Renewable. The Motley Fool recommends Brookfield Renewable and National Grid Plc. The Motley Fool has a disclosure policy.

Billy Duberstein and/or his clients have no position in any of the stocks mentioned. The Motley Fool has positions in and recommends NextEra Energy. The Motley Fool has a disclosure policy.

Billy Duberstein and/or his clients have no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

Billy Duberstein and/or his clients have no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

The continuing threat of a far-reaching trade war and on-again, off-again tariffs has sparked historic volatility in the stock market in recent weeks. The dour mood resulting from ongoing correction has been offset by waves of euphoria, with investors latching onto any positive developments to bid up stocks from recent lows. A bit of good news over the weekend sparked a broad-based rally to kick off the week.

With that as a backdrop, artificial intelligence (AI) specialist Palantir Technologies (PLTR 4.62%) surged 4.6%, semiconductor supplier Micron Technology (MU 1.70%) jumped 2.6%, and iPhone maker Apple (AAPL 2.45%) rallied 2.4%, as of 11:52 a.m. ET on Monday.

Tariffs uncertain

A memo was released by U.S. Customs and Border Protection late Friday, which granted a temporary exclusion from the 145% tariffs on certain electronics from China. The excluded products included smartphones, semiconductors, and chipmaking equipment. The move appeared to be a step in the right direction, as investors have feared that a protracted and far-reaching trade war could stifle the adoption of AI.

In response to this move, Wedbush analyst Dan Ives said that by taking this step, the White House “took the doomsday scenario off the table, and tech stocks will rally tomorrow as investors can now breathe a sigh of relief.”

The certainty was short-lived, as the Trump administration appeared to backpedal in the days that followed. In an interview this weekend, Secretary of Commerce Howard Lutnick said the exemption was only temporary, and tariffs would be hitting electronics over the next couple of months, which would include smartphones and computers.

President Trump sought to clarify his stance Monday morning, saying these products would not be exempted, but instead, “they are just moving to a different Tariff ‘bucket.'”

In a bit of late-breaking company-specific news this morning, the North Atlantic Treaty Organization (NATO) announced in a press release that it had finalized the acquisition of Palantir’s Maven Smart System, which would be deployed at NATO’s Allied Command Operations military headquarters. The announcement noted that the sale was completed on March 25.

Supreme Headquarters Allied Powers Europe (SHAPE) and NATO are using Palantir’s system as a springboard to adopt a range of state-of-the-art systems, “including new, emerging AI models, and modeling and simulation.”

Some investors feared that Palantir’s future results could be negatively affected by spending cuts by the U.S. Department of Defense. However, the ongoing push for more efficient and effective warfighting capabilities by the U.S. and its allies suggests that Palantir could actually be a beneficiary of the modernization efforts by replacing antiquated systems with cutting-edge upgrades.

Time is on our side

While the AI revolution has been front and center for a couple of years, many believe it’s still very early in the overall integration of the technology, and each of our trio of stocks is well-positioned to benefit from these secular tailwinds:

• Palantir’s Artificial Intelligence Platform (AIP) has seen robust adoption, which has been fueling accelerating sales and profit growth.
• Micron is a leading provider of the memory (DRAM) and storage (NAND) chips that are critical components in AI processing.
• Apple is in the process of rolling out its Apple Intelligence across 2.35 billion devices, introducing AI across a broad swath of its products and services.

Some investors fear that a protracted trade war and far-reaching tariffs could stifle AI adoption by significantly increasing the cost of the semiconductors and supplementary products fueling these systems. That said, continuing innovation in the space will likely continue to drive the adoption of AI higher and benefit our trio of companies.

From a valuation perspective, Palantir is still pricey at 165 times forward earnings. However, Apple and Micron are attractively priced, selling for 28 times and 10 times forward earnings, respectively.

Danny Vena has positions in Apple and Palantir Technologies. The Motley Fool has positions in and recommends Apple and Palantir Technologies. The Motley Fool has a disclosure policy.

Stocks of several of China’s most popular technology companies were rallying on Wednesday as the country’s leader promised to support the technology industry and kept its economic growth goals intact.

With that as a backdrop, some of China’s favorite stocks outpaced the gains of the broader market. Shares of Alibaba (BABA 8.16%) surged 7.7%, JD.com (JD 6.23%) climbed 5.7%, and Tencent Holdings (TCEHY 6.45%) rose 5.3% as of 12:50 p.m. ET. There wasn’t any company-specific news fueling the gains, which suggests the comments made by the country’s leader helped drive the stocks higher.

National People’s Congress gets underway

The National People’s Congress is China’s week-long political event and one of the government’s most important annual gatherings. To kick off the meeting, Chinese Premier Li Qiang announced support for the country’s most important emerging industries, particularly in the technology space. “We will establish a mechanism to increase funding for industries of the future and foster industries such as biomanufacturing, quantum technology, embodied artificial intelligence (AI), and 6G technology,” he said.

This show of support was something of a surprise to market watchers and sparked a broad-based rally among China’s most widely followed technology stocks. The MSCI China Index, which represents some of the country’s most well-known large-cap and mid-cap stocks, jumped 2.7% on the news, helping to stoke investor sentiment. This added to the index’s robust performance so far this year, as it has gained 21% since its January low.

Additionally, China kept its economic growth target of 5% intact despite the Trump administration’s tariffs and the increasing concerns of a protracted trade war. China’s willingness to stand by its projections was taken by market watchers to suggest the country is planning to provide additional economic stimulus, particularly to support ongoing developments in AI and quantum computing.

Chinese AI start-up DeepSeek made headlines in late January with the release of its R1 reasoning model, which it claimed could go head-to-head with OpenAI’s o1 model at a fraction of the cost. Many experts have since questioned claims that DeepSeek’s model cost just $5.6 million to develop, with recent estimates suggesting it was closer to $1.6 billion.

The advancements were impressive, nonetheless. Nvidia CEO Jensen Huang said the model was “an excellent innovation” and went so far as to describe it as “a world-class reasoning AI model.”

Why it matters

So, what does all this mean for our trio of Chinese tech stocks? Plenty, as it turns out.

These companies are widely regarded as AI darlings in China. Alibaba’s stock has surged 73% since its low in mid-January (as of this writing). JD and Tencent have also been firmly in rally mode, with the stocks up 41% and 30%, respectively, during the same timeframe. Recent developments suggest there could be more to come.

• Reports emerged that Alibaba is working with Apple to roll out AI features in China.
• JD announced a host of AI-powered enhancements to its JD Cloud offering while providing its cloud customers with free access to many of China’s most popular large language models to create their own AI systems.
• Tencent recently released a new AI model that it says rivals DeepSeek’s R1 in performance while providing faster response times.

Heading into this year, China’s AI tech leaders had lagged many of their U.S.-based counterparts, with Tencent, JD, and Alibaba gaining 41%, 20%, and 9%, respectively, in 2024. However, Beijing signaling support for China’s home-grown AI efforts gave investors confidence that this year’s tech rally has only just begun.

These stocks are currently selling at compelling valuations. Even after the recent rally, Tencent, Alibaba, and JD.com are selling for 16 times, 12 times, and 11 times trailing-12-month earnings, respectively — which are reasonable multiples given their potential for future growth, particularly since they appear to have the backing of the Chinese government.

Chinese stocks tend to be a bit riskier, but for investors with the appropriate long-term outlook and an interest in investing in China, now might be a good time to pick up shares of these stocks before they run higher.

Danny Vena has positions in Apple, JD.com, Nvidia, and Tencent. The Motley Fool has positions in and recommends Apple, Nvidia, and Tencent. The Motley Fool recommends Alibaba Group and JD.com. The Motley Fool has a disclosure policy.