Democratic midterm sweep sparks AI sell-off while oil tumbles on Iran peace hopes
This week @ 15:37 Friday 6th November in London.
Markets:
- FTSE 100 fell 0.96% this week to 10,627.04, as the global AI-led sell-off spread to London on Friday, with energy shares also weighed down by lower oil prices.
- S&P 500 fell 2.18% this week to 7,415.01, after Thursday’s drop of over 4%, its worst day since April 2025, as the Democratic midterm sweep raised concerns over AI regulation and a slowdown in data centre construction.
- Nasdaq Composite fell 2.92% this week to 24,693.49, entering correction territory after a 5.5% fall on Thursday led by chipmakers and AI infrastructure names.
- STOXX Europe 50 fell 0.86% this week to 5,345.97, as worries over AI spending spilled over into European markets.
Bonds:
- UK 10-year gilt yields fell 12.6bps this week to 5.16%, as the sharp fall in oil eased inflation concerns, with the Bank of England’s rate rise widely expected.
- U.S. 10-year Treasury yields fell 2.8bps this week to 4.88%, as lower oil prices eased inflation concerns, offset by expectations of a Federal Reserve rate rise in December.
Commodities:
- Brent crude fell 13.89% this week to $97.67/bbl, as Iran-Qatar talks and the US midterm result raised hopes of de-escalation in the Iran war, though continued attacks on tankers near the Strait of Hormuz provided some support.
- Gold rose 4.11% this week to $4,059.10/oz, rebounding from a one-year low as the slide in oil eased inflation concerns.
- Copper fell 3.15% this week to $6.278/lb, heading for its worst week since March as the tech rout hit sentiment towards data centre demand, though tight physical supply limited losses.
FX:
- GBP/USD was flat, down 0.03% this week to 1.33855, as midweek gains to a seven-week high, driven by a softer dollar after the midterms and the BoE rate rise, were given back as the dollar drew safe-haven demand during the sell-off.
- GBP/EUR fell 0.12% this week to 1.1983.
Macro
- US: Democrats won control of both the House and the Senate in the 3 November midterm elections. Many winning candidates had campaigned on slowing or halting data centre construction.
- US: October non-farm payrolls showed 165,000 jobs added, well above expectations, reinforcing bets on a Fed rate rise in December.
- Bank of England raised Bank Rate by 25bps to 4.00% in an 8-1 vote, its first increase since August 2023. Governor Bailey signalled a further rise was possible without real progress towards settling the Middle East conflict. Markets now price around a 50% chance of another rise in December.
- Middle East: Iranian officials held talks with Qatari mediators on a proposal to end the war and reopen the Strait of Hormuz, though attacks on tankers in the region continued.
Company news:
- Eli Lilly announced an agreement with Hims & Hers to expand access to its weight-loss medicines Zepbound and Foundayo.
What we will be keeping an eye on next week…
w/c 9th November 2026
- Tuesday 10 November: US CPI (October).
- Thursday 12 November: UK Q3 GDP (preliminary estimate).
- Friday 13 November: US PPI (October).
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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