Inside the S&P 500 AI boom, industrials are getting as rich as tech stocks

As the AI infrastructure buildout and global geopolitical developments spur massive spending, an old-guard sector of the economy is getting a level of attention from investors that rivals the action in tech. The industrials sector of the S&P 500 is trading at a price-to-earnings ratio above 30, a level investors more often associate with high fliers, and a P/E ratio that is well above industrials' long-term average, which is closer to 20. "If you look at [Industrial Select Sector SPDR] XLI from State Street, its valuations are really high relative to the S&P 500," Cinthia Murphy, director of research at VettaFi, said on the most recent "ETF Edge." "It's as high as tech, so it really is a sector that has really had its moment in the sun and picked up a lot of attention," Murphy said. The race to construct AI data centers in hopes of gaining a durable business advantage in a rapidly-shifting digital infrastructure has gripped the corporate world and the tech sector. Alphabet, as part of its earnings report on Wednesday, forecast capex for this year of $195 billion to $205 billion. Prior guidance was for spending of $180 billion to $190 billion.McKinsey & Company estimates...