1. Rate hike potential ?

The swap market has started to price potential rate hikes in Europe, a wager bolstered by hawkish comments from a European Central Bank Governing Council member this week. Investors are reaching for their playbooks from 2022, when soaring oil and gas prices spurred inflation expectations and forced monetary policymakers into a tightening cycle.
Back in 2022, the European market suffered a 34% valuation de-rating as the Ukraine war delivered an energy shock. This time around, the pullback has been just 7%.
But only a prolonged period of stress would be required to create meaningful pressure on inflation.

It’s too soon for rate hikes. And don’t extrapolate $100 per barrel for the next two years.

2. The global macro reacceleration theme remains intact.

“Global PMIs continued to strengthen in February, with the share of global manufacturing PMIs in expansion territory now at 85%, and the global composite PMI is at its strongest in almost two years."

3. Energy use in the Euro area is relatively low compared with major peers.

This will likely reduce the risk of an asymmetric impact on the euro area compared with 2022, but the region’s status as a net energy importer still leaves it vulnerable to price spikes and supply disruptions.

4. European defense stocks jump after Iran strikes cargo vessels.

Defense is the sector with the highest expected growth in Europe.

Here is Leonardo and BAE Systems, year-to-date.

5. The robots are coming.

Shares of Serve Robotics jumped after the company reported better-than-expected financial results and provided solid sales guidance for 2026.
Serve, which builds AI-trained autonomous delivery robots, is still small, scaling production and operations. Its delivery robots are an early example of "physical AI," or artificial intelligence that interacts with the real world.
The company ended the quarter with 547 "daily active robots" delivering food from more than 4,500 restaurants for Uber Eats and DoorDash. The company delivered its 2,000th robot in December and expects to generate 2026 sales of $26 million.

"Physical AI improves with real-world data, better AI makes the fleet more valuable, and a more valuable fleet funds the next turn of the cycle -- from city sidewalks to hospital corridors," the company said.

While the company remains small, its success is one example of how AI is spreading into the economy.

Below: Global robotics forecast in millions of robots.

Not a subscriber yet?