LIVE MARKETS-'The decade of the robot’: Barclays sees physical AI near inflection point

(Add blog post) STOXX 600 down 0.6% Cautioun over US-Iran tensions Miners, utilities down over 2% Top earnings: Nestle, Airbus, Rio Tinto Nasdaq futures inch lower Welcome to the home for real-time coverage of markets brought to you by Reuters reporters. You can share your thoughts with us at ‘THE DECADE OF THE ROBOT’; BARCLAYS SEES PHYSICAL AI NEAR INFLECTION POINT Barclays says advances in what it calls “brains, brawn and batteries” are pushing AI-enabled robotics closer to large-scale deployment, shaping the investment agenda for the next decade. The bank estimates that “physical AI” - robots and autonomous machines - could become a market worth between $500 billion and $1.4 trillion, with a baseline around $900 billion. Autonomous vehicles are expected to drive almost half of that, contributing up to $550 billion. “From humanoids and autonomous vehicles to industrial automation and drones, the market is scaling toward a trillion-dollar opportunity by 2035,” says a team of Barclays analysts including Head of Thematic FICC Research Zornitsa Todorova. Its investment case is framed around four pillars - improving computing (TSMC, Samsung, Nvidia), mechanics (Schaeffler, Valeo, MP Materials) and energy systems (EVE Energy and CATL), supported by “enablers” such as Tesla and Xpeng or Amazon, who play a critical role by either building robots directly, or by accelerating adoption through direct deployment of bots. Early deployment is already visible in autonomous vehicles and drones, with industrial and humanoid robots expected to follow. The bank has mapped nearly 200 listed companies across the value chain. It argues physical AI broadens the opportunity beyond semiconductors and hyperscalers to autos, component suppliers and automation specialists, while enablers - largely U.S. and China-based - stand to capture much of the long-term productivity upside. China remains far ahead. Barclays notes it accounted for more than 85% of the roughly 15,000 humanoid robot installations last year, vs only 13% for the U.S., and 55% of global industrial robot installations in 2024. (Danilo Masoni) UTILITIES AND MINERS DRAG, NESTLE DRIVES ZURICH TO NEW RECORD European shares got off to a weaker start on Thursday, dragged down by a pullback in miners (.SXPP) after Wednesday’s sharp rebound. Utilities (.SX6P) also fell sharply following a disappointing update from Centrica (CNA.L) , with sentiment in the sector also hit after Italy approved a hike in corporate taxes on energy firms to help cut power bills, pushing heavyweight Enel (ENEI.MI) down as much as 4%. In Zurich, the defensive SMI (.SSMI) rose for a fifth straight session, up 0.5% to a new record high, supported this time by better-than-expected sales growth at Nestle (NESN.S) , which has recently been hit by infant formula recalls across Europe, Asia and the Americas. The region-wide STOXX 600 (.STOXX) fell 0.2% from Wednesday’s record high. Ex-dividends in London pushed the FTSE 100 (.FTSE) down 0.3%. (Danilo Masoni) EARLIER ON LIVE MARKETS: BEFORE THE BELL: EUROPEAN FUTURES MIXED, AS EARNINGS DRIVE MOVERS CLICK HERE ASIA HOLIDAYS AS US, IRAN WORK TO AVERT CONFLICT CLICK HERE