Tech has not said its last word

European markets extended their advance on Monday, even delivering a new closing record for the broad Stoxx Europe 600 index. Their fairly linear trajectory contrasts with the choppier path taken by Wall Street, which nevertheless benefited from a second rebound session in technology stocks, pushing further away the spectre of the rout sketched out last week. Corporate earnings and a first batch of US macroeconomic statistics are set to occupy investors during this second trading session of the week.

The stock market is a bit like history itself: a succession of dominations. That of the technology sector has lasted for three decades and has only grown in weight. It is challenged at regular intervals, with varying intensity, but always ends up prevailing. Buying large US technology stocks remains the most crowded trade on the planet. The emergence of generative artificial intelligence has only amplified this phenomenon. AI is also creating convulsions that disrupt business models and generate new uncertainties. Investors are responding by keeping their fingers in the technological cookie jar while returning to explore good old traditional sectors. In parallel, empires are stirring to preserve their dominance. This is another of the powerful undercurrents shaping current strategies.

Such periods of upheaval are nothing new. They are part of a long history, which may even have begun on a 10 February for the West. Not today's date, but that of 1763. That date is not only the UN's World Pulses Day, true story. It is also the date of the Treaty of Paris of 1763, the agreement that ended the Seven Years' War. A conflict that Winston Churchill dubbed the "first world war", and which resulted in the loss of a large part of the French colonial empire, notably its possessions in North America stretching from Canada to the Gulf of Mexico. France then ceded the honorary title of the world's leading power to Great Britain. But both countries were financially exhausted after fighting across the globe. London decided to increase the tax burden on the North American colonies, which resisted. A fateful decision, since twenty years later a new Treaty of Paris led to the independence of the United States. A little more than a century on, that young nation would in turn dominate the world, especially after Europeans had slaughtered one another twice in less than 30 years. Will it continue to do so? That is one of the key questions of our time, with roots dating back exactly 263 years.

But back to our market matters. Europe continued its ascent yesterday, brushing aside the somewhat worrying background noise coming from the United States. Just one decline in seven sessions for the Stoxx Europe 600, which therefore posted a record close at 621.41 points, it had climbed a touch higher intraday last Wednesday, without being able to hold the distance. The secret of the index? Traditional sectors firing on all cylinders: double digit gains since 1 January for energy, basic materials and utilities. Only one sector is in the red, consumer cyclicals, mainly luxury and autos. In the United States, software stocks are fighting back. After being battered last week, the software sector is attempting to recover, benefiting from buying interest encouraged by the sharp falls in some names. You do not catch falling knives, except sometimes. For example, Oracle gained 4.7% on Friday and 9.6% yesterday, trimming its 2026 decline to 20%. Volatility remains high as earnings season continues, particularly in this software sector unsettled by the emerging competition from AI.

The dollar remains under close watch. Currency traders flinched yesterday when Bloomberg reported that China is advising its banks to reduce their exposure to US debt. At the same time, White House economic adviser Kevin Hassett suggested that employment conditions in the United States are set to deteriorate in the coming months, notably because of demographic trends. That remark weighed heavily on the greenback and helped push the yield on the US 10 year Treasury below the 4.20% mark. If the labour market weakens, the Federal Reserve will have less reason to hold back on cutting rates. Hassett is clearly speaking for his own side, but his message is resonating. The market is pricing in another rate cut by the US central bank in June, but the possibility of easing as early as the April meeting has gained some ground, with a 36.4% probability, versus 24.5% last week. A first set of US macro data due this afternoon could help refine these bets, ahead of the highly anticipated double release, jobs on Wednesday and inflation on Friday.

Corporate news is busy, with results from BP Plc, AstraZeneca, Barclays, Kering and Philips this morning in Europe. In the United States, stalwarts such as Coca-Cola are expected, alongside companies that will be closely scrutinised for their positive or negative exposure to AI, including S&P Global, Robinhood and Datadog.

Asia-Pacific markets are mostly well oriented this morning, with the exception of Australia, which is flat. The Nikkei 225 is still celebrating the victory of Prime Minister Tanae Takaichi in the general election, rising by 2.4%. Gains are more modest on other markets, notably Hong Kong, up 0.4%, and Seoul, up 0.2%. Leading indicators are mixed in Europe. Earnings releases will help provide direction for some indices.

Today's economic highlights:

Today's schedule includes: the BRC Retail Sales Monitor in the United Kingdom; NAB Business Confidence in Australia; the unemployment rate in France; in the United States, employment costs, retail sales, import and export prices, business inventories, and Fed speeches. See the full calendar here.

• GBP / USD: US$1.37
• Gold: US$5,025.16
• Crude Oil (BRENT): US$69.05
• United States 10 years: 4.19%
• BITCOIN: US$68,984.6

In corporate news:

• Standard Chartered appointed Peter Burrill as interim group chief financial officer following the resignation of Diego De Giorgi.
• Anglo American CEO Duncan Wanblad indicated that a partnership involving Botswana is likely to buy De Beers.
• BP plc is in talks to sell its Gelsenkirchen refinery to the Klesch Group, as part of a broader asset sale plan.
• Tesco plans to open 70 new Express stores, including five former Amazon Fresh sites.
• Porvair reported record profit and revenue for the fiscal year, with a positive outlook for 2026.
• Plus500 announced a new USD 188 million return to shareholders and expects 2026 to exceed market expectations.
• UBS's preferred option is to be a global bank based in Switzerland, according to its CEO, following rumours of a possible move to the US.
• BBVA announces its intention to propose Jordi Montalbo as an independent member of the board of directors.
• The FDA is taking action against Novo Nordisk for misleading television advertising.
• Aedifica is investing nearly €30 million in the development of three healthcare facilities in Germany and Finland.
• Subsea 7 wins a contract in the Mediterranean.
• Alphabet attracted many investors in a USD 20 billion bond offering and plans to issue a 100-year bond in sterling, as well as a transaction in Swiss francs.
• Amazon is reportedly in talks with publishers about a marketplace dedicated to AI content, according to The Information.
• Meta and YouTube (Alphabet) are on trial in California for organising the addiction of young users.
• Salesforce has quietly laid off employees as part of a new wave of job cuts, according to Business Insider.

See more news from UK listed companies here

Analyst Recommendations:

• Legal & General Plc: Berenberg maintains its buy recommendation and raises the target price from GBX 289 to GBX 308.
• Reckitt Benckiser Group Plc: BNP Paribas maintains its outperform recommendation and reduces the target price from GBX 7900 to GBX 7830.
• Admiral Group Plc: Mediobanca maintains its underperform recommendation and reduces the target price from GBX 2894 to GBX 2856.
• Serco Group Plc: RBC Capital maintains its outperform recommendation and raises the target price from GBX 290 to GBX 370.
• Rio Tinto Plc: UBS maintains its neutral recommendation and raises the target price from GBX 5800 to GBX 6900.
• Drax Group Plc: Goldman Sachs initiates a neutral recommendation with a target price of GBX 947.
• Flutter Entertainment Plc: UBS maintains its buy recommendation and reduces the target price from USD 320 to USD 300.
• Croda International Plc: JP Morgan maintains its overweight recommendation and raises the target price from GBP 36 to GBP 40.
• Oxford Instruments Plc: JP Morgan maintains its overweight recommendation and raises the target price from GBP 26 to GBP 30.
• M&G Plc: UBS maintains its neutral recommendation and raises the target price from GBX 290 to GBX 300.
• Antofagasta Plc: Citi maintains its buy recommendation and raises the target price from GBP 39 to GBP 40.