Artificial intelligence dominated investing in 2025 and 2026.
But as investors enter the final months of the year, the question is changing.
It is no longer simply: which AI company should I buy?
Instead, some of the world’s largest investment firms are looking at the enormous infrastructure required to keep the AI boom running: electricity grids, data centres, cooling systems, semiconductors, industrial equipment and the companies financing all of it.
At the same time, government bond yields have climbed to levels not seen in decades, geopolitical uncertainty remains high and Europe is preparing another wave of investment in defence and strategic infrastructure.
The result is a very different investment landscape for 2027.
The OECD expects the global economy to grow by around 3.0% in 2027, after 2.9% in 2026. Artificial-intelligence investment is expected to remain one of the major engines of growth, but higher interest rates, expensive equity valuations and energy costs are creating significant risks.
So where are investors looking now?
Contents
1. AI Is Still the Biggest Story — But the Trade Is Changing
Artificial intelligence is nowhere near finished as an investment theme.
In fact, the amount of money being spent is becoming extraordinary.
Goldman Sachs estimates that major US hyperscalers could invest as much as $1.1 trillion in 2027, as companies race to build the computing capacity required for increasingly powerful AI models.
That means Microsoft, Amazon, Alphabet, Meta and other technology giants need far more than chips.
They need buildings.
They need electricity.
They need cooling.
They need networking equipment, transformers, cables, backup power systems and vast amounts of construction.
That is why one of the most interesting developments going into 2027 is what investors sometimes call the “picks and shovels” AI trade.
Instead of trying to predict which AI application will ultimately win, investors can look at the infrastructure that almost every AI company needs.
The OECD says investment in data-centre structures and technology equipment has already contributed meaningfully to economic growth in countries including the United States, Canada and Australia.
But there is an important warning.
The organisation also says current investment plans assume enormous future earnings. If AI revenues fail to grow quickly enough, today’s massive capital expenditure could become difficult to justify.
So AI remains one of the biggest opportunities heading into 2027 — but also one of the areas where expectations are highest.
2. Electricity Could Become the Hidden AI Investment
One of the biggest bottlenecks in the AI revolution has nothing to do with software.
It is power.
Data centres consume enormous quantities of electricity, and the rapid expansion of AI computing is putting pressure on grids that were never designed for this level of demand.
That has pushed utilities, grid infrastructure and power-generation companies much closer to the centre of the AI investment story.
Recent investment flows already show the shift.
In the week ending September 30, global technology funds recorded significant withdrawals, while utilities attracted fresh money, according to LSEG data reported by Reuters.
The logic is relatively straightforward.
A new generation of AI models can become obsolete surprisingly quickly. A transmission line, transformer or power plant needed to supply a major data centre could remain useful for decades.
That does not make utilities risk-free. They are capital-intensive businesses and can suffer when borrowing costs rise.
But entering 2027, the sector sits at the intersection of several enormous investment trends: AI, electrification, renewable energy, grid modernisation and energy security.
3. Data Centres Are Becoming an Asset Class of Their Own
Just a few years ago, data centres were a relatively specialised corner of real estate and infrastructure investing.
AI has transformed that.
The race to secure computing capacity is forcing technology companies to commit hundreds of billions of dollars to facilities that can house the world’s most advanced processors.
Some of those commitments are astonishing.
Anthropic disclosed commitments connected to an AI infrastructure buildout worth more than $500 billion over the coming decade, while other major technology groups are also increasingly financing data-centre expansion through debt.
The opportunity extends beyond the buildings themselves.
Companies involved in construction, electrical systems, cooling, networking, fibre connections and specialised equipment can all benefit from the same investment cycle.
Europe is accelerating too.
The EU is supporting around €7 billion of investment through 2027 to strengthen European AI computing infrastructure, while new supercomputer capacity is being developed across the continent.
This could make digital infrastructure one of the clearest bridges between the AI boom of 2026 and the investment themes of 2027.
4. Europe’s New Industrial Spending Is Creating Another Theme
Technology is not the only area attracting extraordinary investment.
European governments are also increasing spending on defence, infrastructure and strategic industrial capacity.
The OECD expects new defence initiatives to become an increasingly important support for economic activity in the euro area during 2027.
For markets, the opportunity is broader than defence manufacturers alone.
Additional spending can flow through aerospace, cybersecurity, communications, engineering, logistics, electronics and industrial manufacturing.
It also fits into a broader European push to reduce dependence on foreign technology, energy and critical supply chains.
That means some of the investment themes of the next year could look much more industrial than the market leadership investors became accustomed to during the first phase of the AI boom.
But There Is a Problem: Money Has Become Expensive Again
All of these opportunities come with one major complication.
Borrowing costs are high.
US 10-year Treasury yields recently reached around 5.3%, their highest level in roughly 24 years, while long-term government yields have also risen sharply across Europe and Japan.
That matters because expensive money changes how investors value almost everything.
Companies borrowing billions for data centres have to generate larger returns.
Highly valued growth stocks become less attractive when investors can earn significant yields from government bonds.
And businesses with large amounts of debt face increasingly expensive refinancing.
Reuters calculations based on LSEG data show that around $4.3 trillion of US non-financial corporate debt will mature between 2027 and 2031.
That creates one of the central questions for investors approaching 2027: will the next year belong to the companies spending the most money — or to the assets that finally benefit from money becoming expensive again?
5. Bonds Are Interesting Again — Especially High-Quality Debt
For years, bonds were the boring part of a portfolio.
That is changing fast.
Government bond yields have climbed sharply, making fixed income far more competitive with equities than it was during the ultra-low-rate era.
Major investment houses are once again highlighting high-quality government debt and stronger corporate credit as areas worth watching, particularly for investors looking for income without taking full equity-market risk.
Recent fund flows show that this is not just a theoretical shift.
Billions of dollars have moved back into bond funds, especially short-term and government debt, as investors react to higher yields and greater volatility in equities.
The catch is duration.
Long-term bonds can still become extremely volatile when interest rates rise, and recent movements in government yields have shown how quickly prices can change.
So bonds may be interesting again, but that does not mean every bond is automatically defensive.
6. Gold Is Still Attracting Money — But It Is No Longer a One-Way Trade
Gold has had an extraordinary few years, driven by geopolitical uncertainty, central-bank buying and concerns about currencies and public debt.
But 2026 has also shown how volatile the metal can become when real interest rates rise.
Gold prices have fallen significantly from their recent highs, yet major investment firms continue to highlight central-bank demand and diversification as important long-term supports.
Money is still moving into precious-metals funds too, even as some technology funds have seen outflows.
That suggests gold remains one of the assets investors are using to diversify portfolios heading into 2027.
But it should not be confused with a guaranteed safe haven.
Higher bond yields can make non-yielding assets such as gold less attractive, and the metal has already demonstrated that even a powerful long-term narrative can come with violent short-term corrections.
7. Stocks Still Have Support — But Selectivity Matters More
Despite higher bond yields and concerns about expensive valuations, major investment houses have not abandoned equities.
Earnings are still expected to grow in 2027, particularly in sectors linked to technology, infrastructure and capital spending.
But the source of that growth is changing.
The direct boost from the current AI investment boom may gradually become less dominant, meaning companies will increasingly need to prove that massive spending can translate into real productivity and profits.
That is one reason why simply buying the companies that performed best during the first phase of the AI rally may become a less obvious strategy.
Investors are increasingly focusing on companies with stronger balance sheets, better cash flow and more sustainable earnings.
The message entering 2027 is therefore not that stocks are finished.
It is that investors may need to care more about earnings quality, debt levels and valuation than they did during the strongest part of the rally.
The Investment Themes Experts Are Watching Before 2027
Put the major market outlooks together and a relatively clear group of themes emerges.
AI infrastructure remains one of the largest capital-spending stories in markets, particularly power, chips, memory, networking and data centres.
Utilities and electricity infrastructure are benefiting from the enormous energy requirements behind that expansion.
High-quality bonds have become relevant again because investors can finally earn meaningful income without taking full equity risk.
Gold remains an important diversification theme amid geopolitical uncertainty and central-bank buying.
Industrial and strategic spending in Europe could support sectors connected to defence, infrastructure and supply-chain resilience.
And equities may continue to perform, but experts increasingly emphasise selectivity rather than assuming that every part of the market will rise together.
Five Mistakes Investors Should Avoid Before the Year Ends
The biggest risk may be treating any of these themes as a guaranteed winner.
The first mistake is chasing whatever has already risen the most.
AI-related assets have produced extraordinary returns, but high expectations can make even good companies vulnerable to disappointment.
The second is ignoring interest rates.
When government bonds offer attractive yields, every stock, property project and infrastructure investment has to compete against a much more compelling low-risk alternative.
The third is concentrating too heavily in one theme.
AI, gold or defence may all perform well, but a portfolio built entirely around a single narrative can become extremely fragile if that narrative changes.
The fourth is confusing a strong long-term trend with a good entry price.
An industry can grow for a decade while individual investments within it still lose money.
And the fifth is forgetting liquidity.
Investments that look attractive on paper can become painful if the money is needed during a market correction.
So What Could Matter Most in 2027?
The final months of 2026 are beginning with an unusual combination.
AI spending remains enormous.
Economic growth is still positive.
But borrowing costs are high, government debt is becoming harder to finance and markets are being forced to reassess how much they are willing to pay for future growth.
That could make 2027 very different from the previous two years.
The next investment winners may not necessarily be the companies producing the most visible AI products.
They could be the businesses supplying the electricity, infrastructure, financing and physical equipment that make the technology possible.
At the same time, assets that looked almost irrelevant during the low-rate era — particularly government bonds and income-producing securities — are becoming competitive again.
If you are also thinking about building long-term savings outside financial markets, our guide to whether a private pension is worth it in Europe looks at another way to prepare financially for the future, while BlackRock’s global investment outlook provides a broader view of the major themes currently shaping portfolios.
The key lesson before 2026 ends is not that there is one investment everyone needs to make.
It is that the market is broadening beyond the obvious winners — and the themes investors ignore today may be the ones that matter most in 2027.
