Tech rout and oil slide dominate as Uk political reset reshapes sterling.
This week @ 15:00 pm Friday 26th June in London.
Markets:
- FTSE 100 rose 0.66% this week to 10,431, insulated from the global technology sell-off by its limited tech weighting, with banking stocks providing support after US banks cleared the Federal Reserve stress tests.
- S&P 500 fell 1.91% this week to 7,357, dragged lower by a broad technology rout triggered by a Bank of America note warning of up to three US rate hikes, a steep sell-off in South Korean chip stocks, and persistent selling in megacap names despite strong Micron earnings.
- Nasdaq Composite fell 5.27% this week to 25,122, the hardest hit of the major indices, as concerns over AI infrastructure spending costs, elevated July earnings expectations, and a reported delay to the OpenAI IPO compounded the semiconductor sell-off.
- STOXX Europe 50 fell 0.33% this week to 5,308, cushioned by low technology exposure.
Bonds:
- UK 10-year gilt yields were flat at 4.75%, as weak flash PMI data (composite 49.4) and BoE easing expectations were offset by political uncertainty following Prime Minister Starmer’s resignation on 22 June.
- US 10-year Treasury yields fell 6.4 bps to 4.39%, as sharply lower oil prices eased inflation expectations and equity weakness drove demand for duration.
Commodities:
- Brent crude fell 9.42% this week to $72.98/bbl, its third consecutive weekly decline, as the US-Iran peace framework progressed, the US Treasury authorised Iranian crude sales, and Saudi tankers resumed exports through the Persian Gulf.
- Gold fell 4.29% to $4,063.60/ozt, breaching $4,000 intraday for the first time since November 2025, pressured by a hawkish Fed posture, a stronger dollar, and reduced geopolitical risk premium.
- Copper fell 3.39% to $6.169/lbs, as the risk-off tone and demand concerns from a weakening European services sector weighed on industrial metals.
FX:
- GBP/USD was flat at 1.3221, with an initial sell-off on PMI weakness and the Starmer resignation offset by growing confidence in a smooth Labour leadership transition to Andy Burnham.
- GBP/EUR rose 0.57% to 1.1590, as the euro came under pressure from weaker eurozone PMI data and a dovish ECB tilt.
Macro
- UK flash PMIs (June): Composite fell to 49.4, a second consecutive month of contraction. Services fell to 48.7, its steepest since early 2023, as input cost pressures and political uncertainty weighed on client confidence.
- UK politics: Prime Minister Starmer resigned on 22 June. Andy Burnham is the frontrunner to succeed him, with the Labour leadership contest opening for nominations on 9 July.
- US Q1 GDP and inflation (25 June): GDP revised up to 2.1% annualised; May core PCE rose to 3.4% year-on-year, keeping pressure on the Fed and reducing near-term rate cut expectations.
- Fed stress tests (24 June): All 32 major US banks passed, with aggregate capital remaining above minimum requirements against a hypothetical $708bn loss scenario.
- Iran-US peace framework: Commercial shipping through the Strait of Hormuz accelerated this week, a key driver of the fall in oil prices.
Company news:
- JPMorgan Chase raised its quarterly dividend 10% to $1.65 per share and authorised a new $50bn share buyback programme following the Fed stress test results on 24 June.
- Microsoft, NVIDIA, Alphabet all fell materially during the week as part of the broader technology sell-off, with no material company-specific news driving the moves.
- Shell fell as the sharp decline in Brent crude weighed on energy sector valuations.
What we will be keeping an eye on next week…
w/c 29th June 2026
- US non-farm payrolls (Thursday 2 July): The June employment report, released a day early due to the 4 July holiday, alongside average hourly earnings for inflation signals.
- US ISM Manufacturing PMI (Wednesday 1 July).
- UK Labour leadership: Clarity on the candidate field and fiscal signals from Burnham will be important for gilts and sterling.
- Iran-US peace talks: Progress on the permanent peace framework and Hormuz normalisation remain key for oil prices.
- Q2 earnings season begins mid-July with major US bank results from approximately 15 July.
Enjoy the weekend.
Markets move constantly and the numbers in this update will change. This is a snapshot only, pulled together from a range of sources, and is meant as a quick guide rather than a precise record. It’s not investment advice and shouldn’t be used to make trading or investment decisions. If you need more accurate or specific data over a defined period, please get in touch with a member of the team who will be happy to help.
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