European stocks rose on the back of gains in banks and healthcare. Investors weigh the impact of geopolitics and AI

issued Wednesday, February 18, 2026 · 06:30 AM

[BENGALURU] European stocks closed higher on Tuesday (Feb. 17) as financial and healthcare stocks led the market’s gains while investors tracked geopolitical negotiations and assessed how AI disruption will reshape business models.

The pan-European Stoxx600 index rose 0.5% to 621.29 points. Switzerland’s SMI index rose 0.7%, hitting a record high.

Despite being one of last year’s top performers, the bank rebounded from recent pressure and extended gains from the previous session, rising 1.3%.

Healthcare stocks rose 1.4% to their highest level since September 2024, while the real estate sector index rose 1.8% to its highest level since October.

Geopolitics was in the spotlight after Iran’s foreign minister said the United States and Iran had reached agreement on key “guiding principles” during the second round of indirect nuclear talks.

Separately, U.S.-brokered peace talks between Ukraine and Russia began in Geneva, focusing on the controversial issue of territorial control.

Against this backdrop, defense-related stocks fell 0.2%.

Energy stocks fell 0.6% as Brent crude oil fell more than 1%, while the basic materials sector fell 1.6% as gold, silver and copper prices fell.

Investor sentiment has been rattled in recent days by concerns that artificial intelligence (AI) applications could squeeze the profits of traditional businesses. New concerns caused by AI are rippled across sectors such as software, insurance, and trucking.

“The market is just trying to figure out which companies could be disrupted by AI,” said Roland Kaloyan, head of European equity strategy at Société Générale.

“And what we’re seeing is that the market is starting to build a risk premium because honestly no one knows exactly what the impact is going to be for each company, whether that company is going to be able to take advantage of AI or whether they’re going to have some part of their business that could be disrupted.”

However, European markets managed to counter negative global trends on Tuesday.

Sectors hit at the height of Europe’s sell-off, including media, insurance and technology, rose 0.8% to 0.9%.

Among other gainers, mining company Antofagasta saw its core profit rise 52% for the year, but its stock fell 3.4%, with analysts pointing to a weaker-than-expected dividend and weaker copper prices on Tuesday.

Avolta rose 5% after UBS upgraded its recommendation on the Swiss travel retailer from “neutral” to buy.

BFF Bank’s stock fell 11.8%, hitting a record low, as a source said that an investigation is underway on suspicion of false accounting by the lender. Reuters