AI and Markets: Capex Boosts Semiconductors, but Interest Rates Tighten Constraints

AI Capex, a Key Market Support

Indices remain supported by two simultaneous drivers: corporate earnings and investment spending related to artificial intelligence. This capex dynamic primarily benefits infrastructure providers: semiconductor manufacturers, cloud operators, and data center players.

According to Reuters, major American tech groups now plan more than $700 billion in AI-related spending this year, up from a previous estimate of about $600 billion. This upward revision confirms the central role of AI capex in supporting the semiconductor and digital infrastructure ecosystem.

However, unexpected expenses are also among the factors prompting central banks to adopt a more cautious tone, as they bolster activity and can complicate the disinflation trajectory. Supporting the AI theme does not mean that all index gains are attributable to it: corporate earnings and other sectoral factors also play a role in parallel.

For investors, the key takeaway is to distinguish, within the tech sector, between companies whose AI-related revenues are already reflected in their accounts and those whose exposure remains largely narrative.

Interest Rates: A Monetary Framework That Remains Tight

The monetary context remains restrictive on both sides of the Atlantic. The European Central Bank kept its three key interest rates unchanged on April 30, 2026, while indicating in its monetary policy statement that upward risks to inflation and downward risks to growth have intensified.

In the United States, the Federal Reserve maintained the target range for the Fed funds at 3.50% to 3.75% on April 29, specifying that upcoming decisions will depend on incoming data. The U.S. employment statistics expected this week are among the major tests for Wall Street, as they can alter interest rate expectations.

Mechanically, high long-term rates weigh on the discounted valuations of future cash flows, which particularly affects growth stocks whose significant portion of anticipated profits is distant in time. This mechanism is general: it does not predict the individual behavior of each stock, which also depends on its earnings trajectory.

Reading for Investors: Case-by-Case Analysis

The current environment places technology stocks in a configuration with two opposing factors. On one hand, the momentum of AI spending drives a measurable order flow for part of the ecosystem, from semiconductors to digital infrastructure. On the other hand, the valuation premium awarded to the theme remains vulnerable to any rise in rate expectations, as caution exhibited by the ECB and the Fed reminds us.

This backdrop is set against a tense European macroeconomic context, marked by rising inflation and energy pressure, as mentioned in our article on the French economy facing the oil shock. The challenge is not so much to choose between a bullish or bearish narrative on tech, but to examine each case by distinguishing the share of AI revenues already recognized, the valuation's elasticity to long rates, and the robustness of the business model outside the AI theme.

None of these variables are visible in the overall index; they need to be analyzed stock by stock, based on financial publications and corporate communications.