The key test in the previous US session was whether the market could halt a sell-off that had wiped 5% off the Nasdaq 100 in two sessions. On that score, the day was a success, with the US technology benchmark recovering 1.6%. That only claws back a third of the lost ground, but it does prevent the kind of snowball effect that can grip jittery markets. Semiconductor companies, battered in the previous session, led the recovery. The rest of the market barely joined in, as shown by the S&P 500’s modest 0.3% gain and, still more tellingly, the Dow Jones’ 0.2% decline. The main takeaway is that the slide was arrested by investors’ seemingly inexhaustible appetite for chips.

In Europe, indices had not slumped at the end of last week, so there was no real rebound to speak of yesterday. The prevailing shade was light red, although two markets stood out. The Netherlands eked out a 0.4% gain, helped by its heavy technology weighting through ASML, BE Semiconductor and ASM International. Italy rose 0.6% as speculation swept through its unusually large banking sector, following Intesa’s takeover bid for Banca Monte dei Paschi, which is also being courted by Banco BPM.

The Stoxx Europe 600 has not moved by more than 1% in any of the past ten sessions, which have produced four gains and six declines. It is up 5% since 1 January. Hardly exhilarating, but still in positive territory.

On the geopolitical front, the White House is once again dealing with a powder keg, as previous administrations have done before it. The situation in the Middle East remains unstable. Financial markets keep marking oil higher when they sense a fresh rise in tensions, and lower when the opposite appears to be true. This morning, the oil yo-yo is pointing lower after attacks between Iran and Israel were suspended. A conversation between Donald Trump and Benjamin Netanyahu helped bring prices back towards the middle of their recent range, even though Israel is continuing its operations in Lebanon. Brent fell to $93.40 a barrel, down 6% over one month but up 53% since the start of the year.

The upbeat technology narrative is still being fed by giant IPOs. Several media outlets have confirmed what was already an open secret: SpaceX’s order book is said to be overflowing with demand. Several deep-pocketed financial groups are reported to have placed orders worth more than $10bn. Not to be outdone, OpenAI has filed its preliminary IPO paperwork, the so-called confidential filing that includes neither a timetable nor precise figures at this stage. The owner of ChatGPT could be targeting an autumn listing. Its main rival, Anthropic, also filed preliminary paperwork recently. A stock-market arms race may be in the making.

Tuesday’s session brings no major data releases. The real action is more likely to come tomorrow, with May US inflation figures and the Bank of Canada’s interest-rate decision. Overnight, however, China published very strong import and export numbers, boosted by shipments to the United States. They benefited from a favourable base effect and from strong demand for AI-related components.

In Asia-Pacific, South Korea’s mindless fall the previous day has been erased by an equally absurd rebound this morning: the KOSPI is up 8.4%, after losing 8.3% yesterday. Japan is up 2% and Taiwan 2.9%. Australia and Hong Kong are down 0.2%. India is up 0.1%. Europe still seems to be struggling to move back into forward gear.

Today's economic highlights:

Today's schedule includes: in Australia, the Westpac Consumer Confidence Index, Westpac Consumer Confidence Change, NAB Business Confidence, and the RBA Bulletin; in China, exports, imports, and the balance of trade; in Germany, exports, the balance of trade, and industrial production; in the United States, imports, exports, the balance of trade, existing home sales, and the API crude oil stock change; in Canada, the balance of trade; in the Euro Area, the speech by ECB President Christine Lagarde. See the full calendar here.

  • GBP / USD: US$1.34
  • Gold: US$4,342.25
  • Crude Oil (BRENT): US$92.91
  • United States 10 years: 4.55%
  • BITCOIN: US$63,376.3

In corporate news:

  • AstraZeneca gears up for Phase 3 trial of its weight-loss drug.
  • Shell commences exchange offers for outstanding unregistered notes issued by Shell Finance US.
  • BP plc investors push for clarity over the ousting of the chair, according to the FT.
  • GSK is close to a deal to acquire oncology biotech firm Nuvalent for at least $9 billion, according to the FT.
  • Swiss lawmakers are considering a new compromise on UBS’s capital requirements.
  • Investors are demanding clarity on the ouster of BP Plc’s chairman, according to the FT.
  • PAI Partners is withdrawing from the race to acquire the Nestlé Waters division.
  • Rio Tinto is increasing its annual community investment in Canada by 30% to 13 million Canadian dollars.
  • Banca Monte dei Paschi will review proposals from Banco BPM and Intesa Sanpaolo.
  • Caltagirone and Delfin are once again at the center of banking risks surrounding MPS.
  • Cimbri (Unipol) increases its stake in MPS while CEO Messina advocates for a strategic merger with Unipol.
  • The CEO of Nvidia declines the invitation to testify before the Senate on chip export controls.
  • The co-founder of Siri calls Apple’s update a major first step.
  • Microsoft, HSBC, and other giants sign an agreement with the UK on the adoption of AI in business.
  • Meta is under investigation by the Italian competition authority regarding WhatsApp’s AI tool.
  • Cadence and Intel Foundry strengthen their collaboration on Intel 14A technology.
  • Sempra and Qualcomm are launching an AI-powered wildfire monitoring initiative with UC San Diego.
  • Merck and Gilead are halting the Phase 3 trial combining Trodelvy and Keytruda for lung cancer.
  • Uber sees its push into Delivery Hero thwarted by a Saudi startup.
  • The Pentagon accuses Alibaba, Tencent, BYD, and CATL of ties to the Chinese military.
  • The CEO of Vale says demand for metals remains robust despite the conflict with Iran.
  • Tencent sets the terms of its $4 billion bond offering.
  • SK Hynix orders 44.2 billion won worth of equipment from Hanmi.
  • Main earnings of the day : Bellway p.l.c., Oxford Instruments plc, Molten Ventures Plc.

See more news from UK listed companies here

Analyst Recommendations:

  • Victrex Plc: Berenberg maintains its hold recommendation and reduces the target price from GBX 695 to GBX 600.
  • Chemring Group Plc: Peel Hunt maintains its buy recommendation and reduces the target price from GBP 6 to GBP 5.95.
  • Standard Chartered Plc: Autonomous Research maintains its outperform recommendation and reduces the target price from GBP 23.61 to GBP 21.46.
  • Hsbc Holdings Plc: Autonomous Research maintains its underperform recommendation and reduces the target price from GBP 12.25 to GBP 12.
  • J Sainsbury Plc: Citi maintains its neutral recommendation and reduces the target price from GBP 3.35 to GBP 3.30.
  • M&G Plc: Citi maintains its neutral recommendation and raises the target price from GBP 2.88 to GBP 2.95.
  • Legal & General Plc: Citi maintains its neutral recommendation and raises the target price from GBP 2.49 to GBP 2.51.
  • Diageo Plc: Morgan Stanley maintains its underweight recommendation and reduces the target price from USD 81 to USD 76.
  • British American Tobacco P.l.c.: Morgan Stanley maintains its overweight recommendation and raises the target price from GBX 4900 to GBX 4950.
  • Workspace Group Plc: JP Morgan maintains its overweight recommendation and reduces the target price from GBP 5 to GBP 4.10.
  • The British Land Company Plc: JP Morgan maintains its neutral recommendation and reduces the target price from GBP 4.40 to GBP 4.30.
  • Shell Plc: Argus Research Company maintains its buy recommendation and raises the target price from USD 87 to USD 98.