America's industrial giants are getting a boost from the AI build-out that remains in its 'early stages'

Core Insights - The stock market has reached record highs this year, driven by AI enthusiasm, impacting not only Big Tech but also heavy industry [1] - Caterpillar reported significant sales growth in power generation machinery, with a stock increase of over 11% following its earnings report [2] - The demand for power generation is expected to grow as AI infrastructure expands, with Caterpillar confident in future opportunities [5] Company Performance - Caterpillar's power generation machinery sales saw a 33% year-on-year increase, particularly in reciprocating engines [4] - The company reported adjusted earnings per share (EPS) of $4.95 on $17.6 billion of revenue, surpassing analyst expectations [5] - Following Caterpillar's earnings report, Bank of America raised its price target for the company's shares from $594 to $650 [6] Industry Trends - The data center buildout has positively impacted the industrial sector, with the Industrials sector (XLI) up approximately 18% this year, slightly outperforming the S&P 500's 17% rise [7] - Honeywell also reported strong demand for data centers as a positive aspect of its third-quarter earnings [8]