Big Tech spending fears hit Wall Street as a calm UK budget steadies gilts…
This week @ 15:37 pm Friday 30th October in London.
Markets:
- FTSE 100 rose 0.30% this week to 10,722.07, as Shell’s strong third-quarter results lifted energy heavyweights and the Budget passed without disruption to UK markets.
- S&P 500 fell 0.17% this week to 7,610.90, as disappointing results from Alphabet, followed by Amazon and Intel, revived concerns over the cost of AI spending and reversed earlier gains.
- Nasdaq Composite fell 1.38% this week to 25,597.01, opening Friday at its lowest level in more than two months as the tech sell-off deepened.
- STOXX Europe 50 rose 1.48% this week to 5,399.03, as strong corporate earnings and the ECB’s decision to hold rates lifted European shares to a seven-week high.
Bonds:
- UK 10-year gilt yields fell 7bps this week to 5.30%, as Chancellor John Healey’s first Budget kept fiscal plans tight and planned gilt issuance came in broadly in line with expectations.
- U.S. 10-year Treasury yields fell 4.8bps this week to 4.95%, slipping back below 5% after September core PCE inflation matched forecasts.
Commodities:
- Brent crude rose 1.55% this week to $113.43/bbl, as further tanker attacks in the Strait of Hormuz and Houthi strikes on Saudi energy facilities kept supply concerns elevated.
- Gold fell 1.90% this week to $3,931.90/oz, dropping below $4,000 as strong US growth data and higher oil prices strengthened expectations of a December Fed rate hike.
- Copper was flat, rising 0.06% this week to $6.5115/lb.
FX:
- GBP/USD rose 0.42% this week to 1.3429, as a well-received Budget and expectations of a Bank of England rate hike next week supported sterling.
- GBP/EUR rose 0.44% this week to 1.1991, with sterling supported by BoE hike expectations while the euro lagged its G10 peers.
Macro
- US Q3 GDP grew 3.4% annualised, ahead of the 3.1% expected. September PCE inflation rose to 3.6% y/y, with core PCE in line at 3.1%.
- The Federal Reserve held rates at 3.75% to 4.00% in a 10-2 vote, with both dissenters favouring a hike. Markets are pricing around an 80% chance of a December hike.
- The ECB held its deposit rate at 2.50% after hikes in June and September, warning that high energy costs are adding to inflation risks. President Christine Lagarde announced she will step down in February 2027.
- The Bank of Japan held rates at 1.25% in an 8-1 vote.
- UK Budget: the Chancellor retained around £14.5bn of fiscal headroom, announced temporary energy support for households and raised the bank corporation tax surcharge. Gilt sales for 2026/27 are planned at £250.6bn.
- France’s economy contracted 0.1% in Q3, with French government borrowing costs at their highest since 2002.
- Middle East: shipping through the Strait of Hormuz remained disrupted, and European countries announced plans to release 42.6 million barrels of oil from strategic reserves.
Company news:
- Alphabet fell 12.6% on Thursday, its worst one-day fall on record, after Q3 earnings per share of $2.12 missed the $3.01 consensus, with search and YouTube advertising revenue short of estimates and free cash flow negative as AI spending rose.
- Microsoft beat earnings and revenue forecasts on strong Azure cloud growth, though shares closed lower on reports of a planned bond sale of at least $25bn to fund capital expenditure.
- Shell reported Q3 adjusted earnings of $10.8bn, double the prior year, helped by record refining margins, and announced a $5bn share buyback.
- AstraZeneca rose around 4% on Friday after Q3 revenue grew 7% at constant exchange rates to $16.2bn, core EPS rose 19%, full-year guidance was maintained and a new restructuring programme was announced.
- Eli Lilly reached a record high after Q3 revenue rose 39% to $24.4bn and full-year revenue guidance was raised to $91bn to $92bn.
- Caterpillar had its worst day since March 2020 despite beating earnings estimates and reporting a record $78.1bn backlog, as it left its full-year outlook unchanged.
- ServiceNow fell more than 25% on Thursday after its fourth-quarter guidance for contracted revenue growth fell short of expectations.
What we will be keeping an eye on next week…
w/c 2nd November 2026
- Monday 2 November: US ISM manufacturing PMI and Apple fiscal Q4 results.
- Tuesday 3 November: US midterm elections, with all 435 House seats and 35 Senate seats contested.
- Wednesday 4 November: Eurozone inflation and US ISM services PMI.
- Thursday 5 November: Bank of England decision and Monetary Policy Report, with markets pricing a 25bp rise to 4.00%.
- Friday 6 November: US October non-farm payrolls, with consensus around 55,000 jobs and unemployment at 4.2%.
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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