Futures on the S&P 500 were flat and Europe’s Stoxx 600 index gained 0.1%. NatWest Group Plc climbed 4.8% after Citigroup Inc raised its price target on the UK lender. German bunds and Treasury futures were steady after US yields touched the lowest since December on Friday.

With the US observing the Presidents’ Day holiday and mainland China’s markets closed for Lunar New Year holidays, trading volumes were thin. Still, the path of US interest rates remains in focus following the slower-than-expected US inflation print as traders fully price a Fed cut in July and the strong chance of a move in June.

“The backdrop for equities is positive post CPI,” said Andrea Gabellone, head of global equities at KBC Securities. At the same time, there could be “more dispersion ahead as sentiment around key AI-exposed sectors is still very critical,” he added.

That sentiment was echoed by other strategists seeking to distinguish between AI losers and winners.

A JPMorgan Chase & Co team led by Mislav Matejka urged caution on stocks at risk of AI-driven “cannibalisation,” including software, business services and media companies.

Futures on the tech-heavy Nasdaq 100 were down 0.2%.

Firms are developing tools to capitalise on the divergence. Goldman Sachs Group Inc launched a new basket of software stocks that goes long firms that will benefit from AI adoption, while shorting the companies whose workflows could be replaced.

With AI disruption rippling through markets, a lot will come down to earnings resilience, in particular in the US.

“When you look at the current earnings season, the companies are showing 13% of growth,” Nataliia Lipikhina, head of EMEA equity strategy at JPMorgan, told Bloomberg TV. “Overall, this is the reason why we continue to be positive on the S&P.”

Later this week, traders will be watching for ADP private payrolls numbers on Tuesday and the minutes from the Fed’s January meeting on Wednesday for a fresh read on the economy.