Europe is making progress, between AI-related optimism and geopolitical caution

European stock markets rose on Tuesday, benefiting from optimism about artificial intelligence while the situation in the Middle East remained at the center of attention.

Around 10:50 a.m., the Stoxx Europe 600 index gained 0.6%, to 625.23 points. In Paris, the CAC 40 and the SBF 120 increased by 0.8% and 0.7% respectively. In Frankfurt, the DAX 40 rose 1% and the FTSE 100 posted an increase of 0.3% in London.

On the geopolitical level, caution remains in order as Iran announced on Monday that it would suspend negotiations with the United States as long as Israel continued its military operations in Lebanon. American President Donald Trump, however, affirmed Monday evening that talks with Iran were continuing and that Israel and Hezbollah had agreed to cease their mutual attacks.

“Iran continues to examine and discuss the draft text of a possible memorandum of understanding and has not yet communicated its response,” a well-informed source close to the negotiating team told the Iranian Mehr agency on Tuesday.

In this context, oil prices are falling. Around 10:50 a.m., the August North Sea Brent contract lost 1.8%, to $93.29 per barrel.

On the value side, the boom in artificial intelligence (AI) continues to boost corporate results. On Monday evening, server and networking equipment maker Hewlett Packard Enterprise revealed quarterly results well above expectations thanks to demand for its AI-related products. In France, Stmicroelectronics raised its turnover targets for data centers on Tuesday.

In the macroeconomic chapter, investors are analyzing the preliminary figures for inflation in the euro zone, which reached 3.2% over one year in May after 3% in April and 2.6% in March according to Eurostat data.

On the foreign exchange market, the euro gained 0.1% against the greenback, to 1.1646 dollars.

ACTIONS TO FOLLOW:

-ABIVAX (-27%): the action of the biotech falls after the presentation by the company of the results of a phase 3 study on its molecule obefazimod against ulcerative colitis (UC), which raised doubts about the safety of the medicine.

-STMICROELECTRONICS (+8.4%): the semiconductor manufacturer on Tuesday raised its turnover target for data centers in 2026 and 2027, due to strong demand for infrastructure linked to artificial intelligence. Data center revenue is now expected to be around $1 billion in 2026, whereas the group previously forecast a level “comfortably above $500 million”. “Assuming current momentum continues and given our current commitments, this revenue could double in 2027 (compared to a previously expected level of ‘well above $1 billion’),” STMicroelectronics said.

-SOITEC (+3.8%), SES (-6.3%) and WENDEL (+1.3%): the manufacturer of advanced materials for the semiconductor industry Soitec and the satellite operator SES will join the Stoxx Europe 600 index on June 22 at the opening of the markets, while the investment company Wendel will exit, announced Monday evening ISS Stoxx, a subsidiary of the stock exchange operator Deutsche Börse.

Agefi-Dow Jones The financial newswire

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