Welcome to the home for real-time coverage of markets brought to you by Reuters reporters. You can share your thoughts with us at markets.research@thomsonreuters.com

WHY THE NEXT AI BOOM WON'T LOOK LIKE THE LAST ONE

The shift toward agentic artificial intelligence has been discussed for months. What Wall Street analysts are now flagging is that it is entering a more consequential and costlier phase as companies move from pilot projects to reorganizing their systems, spending and workforces around autonomous software.

Brokerages including Goldman Sachs and Morgan Stanley argue the next leg of AI adoption is less about ever-larger models or headline-grabbing chips, and more about the plumbing that lets AI agents plan and act independently. That includes orchestration software, data infrastructure, CPUs, memory and, less visibly, management time and workforce redesign.

The core transition is from experimenting with AI to restructuring businesses around it, triggering a surge in "intangible" investment that is expensive, largely hidden in corporate accounts and slow to show up in productivity statistics.

Goldman estimates these non-hardware costs covering software, data management and organizational change could ultimately rival or exceed AI hardware spending globally. Because much of this investment is booked as operating expense or done "in-house," it can weigh on near-term output even as it builds capacity for future gains.

The consequences are no longer limited to where companies spend their money. Morgan Stanley's expanded AI adoption survey suggests deployment is already reshaping workforces, with AI driving a net 5% reduction in jobs even as firms report high-single-digit to low-double-digit productivity gains.

Technologies with high upfront costs tend to reward early movers. Analysts say firms that deploy agentic AI at scale are likely to widen their lead, reinforcing market concentration - a dynamic already reflected in investor interest in beneficiaries ranging from chipmakers such as Nvidia NVDA.O, AMD AMD.O and Intel INTC.O to memory and foundry players including SK Hynix 000660.KS, Micron MU.O and TSMC 2330.TW even as the broader economic payoff lags.

(Rashika Singh)

*****

EARLIER ON LIVE MARKETS:

THE FERTILIZER SHOCK THAT LOOMS OVER LOW-INCOME EMERGING MARKETS CLICK HERE

EUROPE'S AIR DEFENSE BOOM STILL FLYING BELOW INVESTORS' RADAR - MORGAN STANLEY CLICK HERE

S&P 500 FUTURES PARE LOSSES SLIGHTLY AFTER CPI CLICK HERE

HERE COMES U.S. INFLATION... CLICK HERE

AI INVESTMENT HAPPENING NO MATTER THE COST CLICK HERE

GILTS TEETER ON THE EDGE CLICK HERE

SOFT FIRST FEW HOURS FOR EUROPEAN STOCKS CLICK HERE

EUROPE BEFORE THE BELL: NOW ADD UK POLITICS TO THE MIX CLICK HERE

MORNING BID: PEACE TALKS STUTTER CLICK HERE