After two hesitant sessions in the United States, equities resumed their upward march, still fuelled by the artificial intelligence boom. One market ranking neatly captures what is currently unfolding: the benchmark semiconductor product, the iShares Semiconductor ETF, has risen in 22 of the last 25 trading sessions. By yesterday's close, it had reached the symbolic threshold of a 60% gain since the start of the year. That is ten times better than Wall Street's solid flagship index, the S&P 500 (+6.04%), or the broad MSCI World index (+5.56%). So much capital is pouring into computing power that even the industry's laggards, or companies once viewed as such, are benefiting. Right now, betting against a badly managed, loss-making semiconductor company with questionable prospects is akin to stepping in front of a high-speed train and hoping to stop it.

Yet the surge is not entirely unjustified. Anyone who has ventured beyond amusing AI-generated images and formulaic text quickly realises that something extraordinary is taking shape. The stock market is merely reflecting that reality. Strategist Ed Yardeni expressed it more academically in his latest note. Before the emergence of AI, he wrote, economists traditionally worked with three factors of production: land, labour and capital. They are now being forced to integrate a fourth factor, data. "This resource is unlimited. But before AI, it was not especially useful because collecting, processing and analysing it was prohibitively expensive," Yardeni noted. Capital expenditure trends reflect the shift. Technology has gradually overtaken traditional sectors to account for roughly 55% of investment within nominal US GDP in the first quarter of 2026.

Investors would naturally prefer greater certainty that this abundance will translate into meaningful economic gains over the medium to long term. But in the absence of sufficient visibility, they are concentrating on the most obvious winners while abandoning the clearest losers. Markets would probably feel more comfortable if the benefits were spreading more broadly across sectors, but that is not today's story. In 2026, AI means +60%, while the broader market means +6%. For now, that is enough. The narrative also remains firmly intact: Samsung Electronics crossed the $1 trillion market capitalisation threshold this morning thanks to its contribution to the AI ecosystem. That is almost equivalent to the combined valuation of France's five largest listed companies. After the closing bell, AMD surged 17% on Wall Street following earnings that suggested no let-up whatsoever in enthusiasm for artificial intelligence.

Geopolitics, however, continues to dominate the news cycle. Escalations and de-escalations continue to alternate across the Middle East. Oil prices are moving in line with the noise and have been trending lower since yesterday. The United States and Iran may be edging towards an agreement aimed at ending their conflict and reopening the Strait of Hormuz. Markets have heard this tune before. A deal will eventually be reached and economies will adapt to structurally higher oil prices, particularly if they begin to retreat from recent peaks. That is the prevailing market mood, even if nothing has yet been finalised. Investors have not forgotten that financial markets tend to have short memories when it comes to armed conflicts: once the initial shockwave passes, equities usually move on quickly. Oil shocks are another matter entirely, one that still haunts the baby boomer generation. Ultimately, everything depends on how long the crisis lasts. For now, crude remains within the range the market still considers manageable.

While rumours continue to swirl around the Middle East, the world's two most powerful leaders are preparing for their meeting in Beijing next week. Donald Trump and Xi Jinping are expected to discuss Iran as well as Taiwan, according to the latest available reports. Earnings season also remains in full swing. Europe delivers heavyweight results from Novo Nordisk, Equinor, Infineon, BMW, Endesa, Diageo and Ahold Delhaize, among others. The United States will follow with updates from ARM, Walt Disney, AppLovin and Marriott.

Across Asia-Pacific, Japan remains closed for a public holiday, but trading has resumed elsewhere. South Korea is surging 6%, driven by Samsung and SK Hynix. Gains are more modest in Australia (+1%), Hong Kong (+1%) and India (+0.3%), though markets there are also moving higher. Europe is expected to open in positive territory.

Today's economic highlights:

Today's agenda includes: industrial production in France; services PMIs in Spain and Italy; retail sales in Italy; several ECB speeches in the Euro Area; in the United States, the MBA 30-Year Mortgage Rate, ADP Employment Change, Fed speeches, and EIA gasoline and crude oil stocks changes; in Canada, the seasonally adjusted Ivey PMI. See the full calendar here.

  • GBP / USD: US$1.36
  • Gold: US$4,648.84
  • Crude Oil (BRENT): US$108.45
  • United States 10 years: 4.42%
  • BITCOIN: US$81,369.8

In corporate news:

  • Glencore reported two fatalities and five injuries at its Kazzinc zinc plant in Kazakhstan following an explosion and fire.
  • Rio Tinto awarded Sodexo a seven-year contract for facilities management at its Western Australia accommodation villages.
  • Standard Chartered plans to strengthen its wealth management teams in the Gulf despite the ongoing conflict.
  • Novo Nordisk expects its revenue to contract slightly less than previously forecast this year.
  • Equinor beat first-quarter profit expectations.
  • Infineon has raised its guidance.
  • BMW reported pressure on its automotive margin in the first quarter.
  • Logitech improved both annual sales and net profit.
  • Continental proved more profitable than expected in the first quarter.
  • Alcon beat expectations in the first quarter of 2026.
  • Philips also exceeded first-quarter expectations.
  • Verisure is targeting growth in annual recurring revenue for the 2026 financial year.
  • Lufthansa reduced its operating loss in the first quarter.
  • DSM-Firmenich reported first-quarter figures broadly in line with expectations.
  • Daimler Truck posted lower net profit and revenue in the first quarter.
  • Heidelberg Materials expects higher energy costs following the escalation in the Middle East.
  • Amplifon reported higher first-quarter earnings and is targeting organic growth above 3% in 2026.
  • Lottomatica expects 2026 adjusted EBITDA to come in at the upper end of its guidance range.
  • Banco Santander is considering removing the TSB brand from the British banking landscape, according to the Financial Times.
  • UPM-Kymmene has approved its demerger project.
  • EDP is considering the sale of its US subsidiary focused on small-scale solar projects, according to Bloomberg.
  • Sixt is offering special deals to travellers affected by the suspension of Spirit Airlines operations.

See more news from UK listed companies here

Analyst Recommendations:

  • Standard Chartered Plc: Keefe Bruyette & Woods upgrades to market perform from underperform with a price target raised from GBX 1700 to GBX 2000.
  • Barclays Plc: Jefferies maintains its buy recommendation and raises the target price from GBX 570 to GBX 590.
  • Pearson Plc: Goldman Sachs maintains its buy recommendation and raises the target price from GBX 1300 to GBX 1350.
  • Fresenius Medical Care Ag: Landesbank Baden-Wuerttemberg maintains its buy recommendation and reduces the target price from EUR 50 to EUR 45.
  • Puig Brands Sa: BNP Paribas downgrades to neutral from outperform and reduces the target price from EUR 23 to EUR 18.50.
  • Unibail-Rodamco-Westfield Se: Bernstein maintains its outperform recommendation and raises the target price from EUR 123 to EUR 127.
  • Ferrari N.v.: Bernstein maintains its outperform rating and reduces the target price from USD 410 to USD 402.
  • Anheuser-Busch Inbev Sa/Nv: Oddo BHF maintains its outperform rating and raises the target price from EUR 74 to EUR 76.