AI Data Centers Lift Battery ETFs 30% in a Month

The recent rally in South Korean battery stocks is more than a simple market rotation; it points to a fundamental shift in demand for energy storage systems (ESS) fueled by AI data centers. While chip stocks paused, secondary battery ETFs saw gains up to 45.88% in a month. This suggests AI's energy appetite is creating a new growth market for batteries beyond electric vehicles, which had previously driven the sector. Policy tailwinds in the United States further bolster this outlook for Korean firms. Washington's designation of ESS as critical power infrastructure on August 26, 2023, is expected to favor Korean companies with North American production bases by raising barriers for Chinese competitors. LG Energy Solution and Samsung SDI have already expanded their North American ESS market share to 19.7% from 13.9% in the first half of 2023, underscoring their readiness to capitalize on this trend. The key watch point is whether this rebound translates into sustained earnings growth and expanded ESS orders in the second half of the year.