Alphabet to Replace Verizon on Dow Jones, Expected to Boost ETF Inflows
Alphabet will join the Dow Jones Industrial Average, replacing Verizon and likely increasing passive fund inflows. AI data centers consumed about 415 terawatt-hours in 2024 with demand forecast to double to 945 TWh by 2030, underscoring energy cost risks for large tech firms.
1. Dow Jones Inclusion Enhances Passive Demand
Alphabet will replace Verizon in the Dow Jones Industrial Average later this month, marking a significant shift in the 30-stock index. Inclusion typically triggers sizeable purchases by index funds and ETFs, potentially driving additional liquidity into Alphabet shares and reflecting its position as a market leader beyond search and advertising.
2. AI Data Center Energy Needs Surge
Global AI data centers drew approximately 415 terawatt-hours from grids in 2024, equivalent to 670,000 barrels of oil per day, with forecasts pointing to 945 TWh by 2030. As Alphabet expands AI services and cloud offerings, rising power consumption and potential grid constraints could drive up operating and capital costs, while intensifying focus on sustainable energy sourcing.
