Realisation on St. Louis after rally, wait rises for US big tech accounts

(Il Sole 24 Ore Radiocor) - Profit-taking on Stmicroelectronics , which last week rallied (+15.6% in two sessions) after the publication of its first-quarter accounts, which were very well received by the market and investors. Today's slowdown does not change the longer-term trend, with the stock rising 46% in the past month and 92% so far in 2026. The consensus view among analysts is that the stock is no longer rising because of sectoral rotation, but because of momentum related to industry fundamentals.

"The point is that today St is no longer read only as a cyclical story linked to the car and this is the real change in identity. AI has been a global theme for some time, but only now is it really entering the main Italia list, not by reflex, not by indirect narrative, but in numbers. St brings to the accounts a transformation that the market has been waiting for for months,' say the experts at eToro.

Citi's analysts, who cconfirmed the 'buy' rating and raised the price target from EUR 31 to EUR 52 per share (currently EUR 43), also give no weight to today's share price drop, but emphasised 'a cyclical rebound and structural growth, which will be able to sustain the momentum of the shares', after 'a solid first quarter, with revenues and gross margin above expectations'. This, in addition to management's positive outlook on the second quarter, "points to a clear recovery expected in 2026, due to the normalisation of stocks, improved demand dynamics", including in artificial intelligence.

After all, it is precisely AI, and in particular the sustainability of the sector's strong expansion, propelled by maxi investments by companies in the sector, that is at the centre of the technology debate. There will be much talk about this in the coming days, in what promises to be one of the busiest weeks of the year, as four of the American Big Techs - Alphabet, Microsoft, Amazon and Meta Platforms - will publish their results on Wednesday, followed by Apple the next day. The numbers of these companies, which have reached a combined market capitalisation of $11.6 billion, or over 19% of the entire S&P 500, will give investors a clear picture of the sustainability of the global artificial intelligence maxi bet.

"Markets are looking for a new narrative and for now they are returning to the AI boom," say analysts at Panmure Liberum. The analysts expect the Big Techs to post an overall profit growth of around 25 per cent, while the information technology sector as a whole is expected to postgrowth of over 46 per cent. It is also expected that the 'Magnificent 7' (Alphabet, Amazon, Apple, Meta Platforms, Microsoft, Nvidia and Tesla) will continue to support large investments to enhance artificial intelligence infrastructures. The combined expenditure of Microsoft, Alphabet, Amazon and Meta is expected to reach USD 649 billion in 2026, up from USD 411 billion in 2025.