European stocks are experiencing their best week since May, buoyed by sustained investor confidence in artificial intelligence. This marks the sixth consecutive day of gains, with the Stoxx Europe 600 Index reaching a record high. Mining and bank shares are outperforming, while technology and food and beverage sectors lag.
Driving the optimism is the expectation that substantial capital investments in the AI sector will translate into increased profits, particularly for technology stocks. Recent activity, such as OpenAI's $6.6 billion share sale valuing the company at $500 billion, has further fuelled this sentiment. Several partnerships and acquisitions in the AI space, including Hitachi's collaboration with OpenAI and Global Infrastructure Partners' potential acquisition of Aligned Data Centers, also contribute to the positive market movement.
Despite a US government shutdown and delayed economic data releases, investors remain focused on the potential of AI to drive market growth. However, some strategists caution that the tech rally may be outpacing fundamental earnings, suggesting the need for confirmed demand to sustain the upward trend.
